Apartment marketing / speculation thread [Archive]

Grollo

September 13th, 2005, 04:52 PM

I think it's official now, there will be no bust in the Melbourne apartment market and next year is shaping up to be a big year for new apartment tower approvals and sales.

Renters lap up units as the building binge ends
Maurice Dunlevy
THE AUSTRALIAN September 13, 2005

MELBOURNE'S buoyant rental market is offsetting the city's apartment building binge, with 2600 new units to be completed in the next 12 months - 1090 before Christmas.

Charter Keck Cramer director of strategic research, Robert Papaleo, said the sector continued to defy critics as major developers, including Sunland, pressed ahead with plans to build even more luxury apartments.

"Sales and rentals are both strong, and there hasn't been any widespread failure by buyers to settle on any building," he said.

However, Wakelin Property Advisory director Richard Wakelin said yesterday he was far from convinced about the health of the market because of poor apartment resales.

"People don't talk about the secondary market, and I think we haven't even scratched the large impending levels of supply," he said.

RMIT property expert Chris White said large numbers of new apartments normally indicated a correction, particularly for the rental market.

But Mr White, executive director of property services at RMIT, said the unknown was the extent to which young people wanted to live in the inner city. "No one is about to predict where the bottom of that market is," he said.

According to Mr Papaleo, 1090 apartments would be completed across the central city region by Christmas, and 1500 more would be finished in the first half of 2006.

He said completions would slow to 900 in the second half of next year, and the construction boom would be over by 2007, with between 300-400 apartments likely to be completed in each half of that year.

Mr Papaleo said rental demand had been surprisingly strong, absorbing most of the new apartments.

With industry estimates of 80 per cent of completed apartments already sold to off-the-plan buyers, a spokeswoman for one of the CBD's largest letting agencies said the lease market was still good after one of the strongest ever starts in January and February.

Melbourne City Leasing's Mary Chan said cheaper investment-type apartments were rarely vacant for more than a few weeks because of demand from students and young CBD workers wanting to save on fares and ever-rising petrol costs.

The most immediate completions are in the CBD, where David Deague's Asian Pacific Building Corporation and Brisbane's Baycrown are adding finishing touches to two projects involving some 670 apartments.

The Deague project, involving 300 apartments, is near the Docklands end of Collins Street. The developer has built a mix of residential, hotel and serviced apartments.

Baycrown's Flinders Street student apartment project is opposite the Flinders Street Railway Station and involves 70 apartments in a smaller tower and 306 in a larger tower.

Other second-half 2005 completions are at the Grollo-controlled Eureka and QV sites, Sol Sapir's Hallmark project at the former St Kilda Road Travelodge, St Kilda Road's Royal Domain project and Australian Super Development's Herald & Weekly Times site.

Meanwhile, interstate developers have lost none of their appetite for the Melbourne market, with Sydney-based Estate Properties of Australia well into separate apartment projects on Queens Road and Spencer Street with an end value of some $285 million. The Sunland group is also pressing ahead with plans to build its second St Kilda Road luxury tower for about $105 million.

CULWULLA

September 14th, 2005, 12:33 AM

^ are any of these new projects going to be over 20storeys? seems to be lots of smaller projects. Sydney is also going ahead with smaller stuff. not sure when we will see another "500footer" besides the 3 uc atm? most have turned into "mixed" use projects like whats happening in brisby.

Aussie Steve

September 14th, 2005, 12:54 AM

As I was walking up St Kilda Rd on the weekend, I spotted at least 7 potential development sites on St Kilda Rd and another 5 on Queens Road. 5/7 on St Kilda Rd either have approved development plans or plans in the pipe line and 3/5 on Queens Rd are the same.

tayser

September 14th, 2005, 07:09 AM

I know why this is so, but we're completely missing projects along the Moorabbin-Caulfield corridor.

Patterson, McKinnon, and Glenhuntly have all got development happening around their stations (3 level stuff, naturally that's why it's overlooked ;)), and Bentleigh - holy fuck how big is that car park behind the main strip (Coles Car park) - potential for mammoth development in there.

tayser

September 23rd, 2005, 02:33 AM

AFR
Melbourne's bleak, not black
Mathew Dunckley
23 September 2005

The Melbourne inner-city apartment market, widely regarded as the weakest in the country, has not come to the screeching halt so many predicted according to Charter Keck Cramer's six-monthly State of the Market report.

The report argues that while there has been a development slowdown across the central city region including Southbank, St Kilda Road, Docklands and the central business district it has been an "orderly correction".

The report analyses supply and demand but does not examine sale prices or purchaser profiles.

It shows there were 1605 unsold apartments at the end of June, the lowest stock overhang recorded for four years.

Off-the-plan sales activity was stable with an estimated 617 sales in the first half of this year compared with 636 in the same period last year.

Some 1169 of the unsold apartments were in projects under construction, but with pre-commitment running at 75 per cent, this figure was indicative of the volume of work being completed rather than risk-taking by developers.

Historically, the most unsold apartments are in the marketing phase but the report shows there were only 68 apartments in that category compared with about 1000 in recent years.

In a sign of the slowdown, only about 600 apartments were due to be released this year half last year's total of 1220 and "significantly lower" than the annual average of 3850 between 1999 and 2002.

The number of apartment commencements had also fallen, 750 in the first six months of this year from a peak in the first half of 2001 of 2390.

Not surprisingly, given the lag time from the peak, there were still 3090 apartments scheduled for completion this year. That was expected to slip to 2500 in 2006 before dropping dramatically to 458 in 2007 and 569 in 2008.

"The [central city] apartment submarket has clearly undergone a moderation of conditions," Charter Keck Cramer strategic research director Robert Papaleo said. "However, many of the demographic, social and economic fundamentals that underpinned the previous upswing are still present.

"There has been a stark contrast between the commonly expected outcome of an imminent chaotic market correction in prices, sales activity and project failures and the observed reality of a relatively orderly, self-regulating market that is unwinding from a once-off and unsustainable market peak.

"The perceived extent of adjustment currently being experienced is therefore overstated because of the unsustainable peak that the market has come from."

Mr Papaleo noted there had been no withdrawals of projects released since 2003 in the inner-city nor was there proof that purchasers were failing to settle upon completion of their apartments.

"There has not been any observed occurrence of an en masse failure to settle upon any single project in the [central city]," he said.

Mr Papaleo said purchaser sentiment bottomed in mid-2004, which had slowed supply.

"This ensuing supply hiatus will, firstly, enable the market to fully absorb the recent wave of new supply and, secondly, establish the preconditions for the beginning of the next cyclical upswing by enabling pent-up demand to re-build and underpin commitment to new projects."

But that upswing would not be as heady as the one that preceded it because the market had matured and segmented with a larger resale sector, he said.

KEY POINTS

· There were 1605 unsold units in Melbourne at the end of June.

· The number of apartments due for release this year is half last year.

· The lower supply will prepare the market for a higher growth future.

Marky Mark

October 8th, 2005, 01:49 AM

This article basically states that the next round of Apartment Building isn't that far off !
I would love to see those purchasers win that case against Mirvac and get that Glass changed to real Gold !

All that glisters is not sold
October 8, 2005

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Melbourne
Photo: John Donegan

Inner-city high-rise apartments have hit buyers in the hip pocket. Cameron Houston and Aileen Keenan report.

MELBOURNE restaurateur Jimmy Siu was one of hundreds to queue at a glitzy Docklands showroom in March 2002 as a team of sales staff worked the room. Tower Five was to be the crowning glory of the Yarra's Edge development and Mr Siu said he was assured the building would be sheathed in shimmering gold; a traditional symbol of prosperity and positive feng shui in Chinese culture. In just four days, listed developer Mirvac sold more than $140 million worth of off-the-plan apartments in Tower Five, including two apartments to Mr Siu for $3.5 million.

More than three years later Tower Five has lost some of its sparkle, with almost 30 apartments yet to settle, amid claims of misleading and deceptive conduct by Mirvac's sales staff.

"I showed him my gold watch and the salesman said that was the colour of the tower I would be living in," Mr Siu said. "It's not even close to gold or bronze, it's more shitty brown."

While investors and developers quibble over the colour of gold, Melbourne's CBD apartment towers have become the public face of the nation's overheated property market, with everyone from the Reserve Bank of Australia to the federal Treasurer taking aim.

Advertisement
AdvertisementIn December 2003, RBA governor Ian Macfarlane said some inner-city apartments in Sydney and Melbourne had fallen in value by 40 per cent, and expressed concerns for over-leveraged investors. RBA consultant and Residex founder John Edwards went further and described the Docklands buildings as "the ghettos of the future".

Yet inner-city apartments represent just 1.3 per cent of Melbourne's total housing stock, while the much-maligned Docklands precinct accounts for only 0.2 per cent of the market.

Between 1999 and 2002, Melbourne's burgeoning high-rise market seemed invincible, with an annual average of 3850 off-the-plan sales. Developers invested billions on the basis of demographic forecasts that predicted a torrent of young professionals and ageing baby boomers would swap their traditional suburban plots for an apartment in the sky.

Swept up in the gold rush, some investors staked their children's inheritance on Melbourne's mushrooming skyline, many using deposit bonds to leverage themselves to the hilt.

The Age commissioned research from property analyst Cityscope on the CBD, Southbank and St Kilda-Queens Road precincts, and it provides a comprehensive profile of the state of the market.

With just 96 off-the-plan apartments now on offer in the CBD, the downturn has been swift and painful for many investors, many of whom have been forced to refinance and brace for some lean times ahead.

Slater & Gordon partner Lisa Nichols is representing 12 Asian buyers in Tower Five, including Mr Siu, and says their class action against Mirvac is definitely not about money.

"They (Mirvac Group) can either rescind the contracts or make the building gold," Ms Nichols said.

But would apartment buyers be looking to slide out of contracts if the underlying value of their properties had increased over the past three years? Were they duped by silver-tongued sales staff who made promises the market could not deliver on? Or were they simply victims of their own poor investment decisions?

Mirvac has adopted a hard line and has stoutly refused to allow buyers off the hook. Victorian state manager Brett Draffen says the company will pursue specific performance from every buyer who can afford to settle.

"We'll vigorously defend these matters and we're determined to ensure that all buyers fulfil their contractual obligations," Mr Draffen said. He also said independent valuations by two firms had come in "at or about" the original purchase price, but conceded that the market had shifted since the halcyon days of 2002.

Determining the exact value of Docklands apartments is difficult due to the paucity of sales data, but analysts estimate apartments bought off-the-plan at the height of the boom had fallen by up to 20 per cent by settlement.

Charter Keck Cramer research manager Robert Papaleo says the falls need to be placed in context. In the firm's biannual State of the Market Report, Mr Papaleo says the declines followed an initial blip that was created by unbridled demand in an undersupplied and immature market.

Critical of the doomsday predictions, Mr Papaleo describes the current adjustments as an orderly correction rather than the calamitous collapse predicted by several pundits.

The Cityscope data reveals that buyers who chose their rooms with a view wisely profited, but overall, Melbourne's nascent CBD apartment market has proven to be a mirage for many investors.

Analysis of 9655 apartment sales in 170 inner-city developments reveals an average median return of 3.39 per cent — hardly stellar, but well short of the "blood on the streets" forecasts of BIS Shrapnel in 2003.

The Star Apartments project in Flagstaff Lane, West Melbourne, was the standout performer with a median annualised return of 17.63 per cent, while investors in Southbank's Flinders Wharf apartments have lost 5.72 per cent on an annualised basis.

Fifty-three developments achieved median returns of less than 2 per cent.

The St Kilda Road-Queens Road area has done best, with a median annualised return of 4.51 per cent, with nine developments ranking in the top 15 for annualised returns.

The top five annualised median returns in the area were achieved by Robsart in St Kilda Road (11.06 per cent), Mode Apartments in Queens Road (10.62 per cent), The Domain in Albert Road (9.83 per cent), Lancaster House in Queens Road (9.70 per cent) and Queenscourt in St Kilda Road (8.90 per cent).

Apartment projects in Melbourne's CBD area have yielded an annualised median return of 3.38 per cent and the CBD had six developments in the top 15.

The overall annualised median return for Southbank developments is substantially lower at 2.54 per cent. The precinct's leading development is The Melburnian, which achieved a median annual return of 6.4 per cent.

However, the precinct is likely to receive a fillip from the high-profile Eureka Tower and Freshwater Place developments aimed at owner-occupiers.

But what happens now as the market deals with the aftermath of a debt-financed binge?

Macquarie Bank's head of property research, Rod Cornish, says it will be about four years before the market awakes from its torpor, although there are already signs of resilience at the top end.

Mr Cornish says Melbourne's inner-city apartment market had been the worst affected nationally, but is already over the worst of the pain, despite a record 3090 units settling this year.

Melbourne's residential property market reached its nadir last year, and apartments are now benefiting from renewed confidence in the broader housing market.

But Mr Cornish has issued an important caveat: generic investment stock, with few owner-occupiers in the market, could experience further declines in value.

Mr Papaleo says purchaser sentiment has progressively improved over the past year and a hiatus of new supply in 2007-08 will allow the overhang of new stock to be absorbed and create demand for the next construction cycle.

In June this year there were 1605 unsold apartments, the lowest stock surplus since the second half of 2001.

Several Docklands developers saw the writing on the wall and have already modified or shelved development plans.

Lend Lease cancelled its $50 million Park Terrace project at Victoria Harbour, while ING Real Estate's Waterfront City has made a "concerted shift away from high-rise development in favour of an East Melbourne-meets-the-water approach", according to managing director Mark Broomfield.

Mr Papaleo estimates there will be 20,000 contemporary inner-city apartments by the end of 2005 and this will increase to 22,500 by end of next year, with 23,500 by 2008.

But speculators hungry for another bull run should take a cold shower, according to Mr Papaleo.

He says the market is unlikely to experience similar rates of growth, as there is now a large and varied supply of apartments that will absorb sudden demand spikes.

Exactly when prices begin to rise will be determined by the demand for high-rise living and subsequent upward pressure on rents. Property analysts point to an upswing in rents by next year, but they are unlikely to substantially offset low investment yields.

Mr Cornish says high building costs have helped to underpin the value of new apartments, and generally fall at the end of a construction cycle.

He says construction costs have not fallen, but the rate at which they are increasing has eased and, with demand for construction in the commercial property sector strong, he does not expect building costs to decrease substantially.

Developer Morry Schwartz was less sanguine regarding Victoria's construction costs.

"I'll tell you one thing, they're (building costs) not going to go backwards and the market would need to stage a significant rally before further apartment towers appear on the Melbourne skyline," Mr Schwartz said.

He says resales in his Watergate development are still happening, but prices are coming back, while the rental market has improved dramatically, with almost full occupancy and rents rising by up to 10 per cent over the past year.

But Docklands developers continue to lament that the $8 billion precinct has become yet another victim of the dreaded tall poppy syndrome.

While specific warnings from the Treasurer and RBA governor were intended to quell investment demand, MAB Corporation's general manager of development, Rod McDonald, says their comments are unreasonable and misguided.

"When you go over the Bolte Bridge, the Docklands is highly visible, which made us an easy target," Mr McDonald said.

Unperturbed by the gloom, MAB Corporation is close to completing its fifth residential building, Conder Tower, which brings the total number of apartments in their New Quay development to almost 1000.

Mr McDonald says most of their apartments have recorded double-digit growth since coming on line, while vacancy rates have been below 2 per cent for the past 18 months.

"Only a handful of apartments have fallen in value and that's usually where there's been a forced sale, but the idea there was going to be this hard landing with thousands of people in distress has not eventuated at all," Mr McDonald said.

While a widespread collapse seems to have been averted, it remains to be seen whether Melbourne's sparkling skyline will once regain its lustre with investors.

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Grollo

October 8th, 2005, 02:51 AM

The only reason that some inner city apartments have dropped in value is those unreasonable and excessive warnings by the Reserve Bank of Australia and the federal Treasurer and delibetately misleading predictions by various property commentators who have vested interets in traditional housing stock in the inner city and wanted to shut down the competition.

The market would have slowed anyways due to rising construction costs, which is to be expected when a city undergoes the largest construction boom in Australian history. But the solid rental returns and low vacancy rates have proved that the demand is there for inner city apartments and that there is no oversupply of apartments.

Apartment values in Melbourne have risen by 9% over the past two years, house prices have risen by only 1%!

shrewd.user

October 8th, 2005, 06:08 AM

Apartment values in Melbourne have risen by 9% over the past two years, house prices have risen by only 1%!

thats an interesting stat, i guess inner city apartments are becomming more disireable as running a car becomes more expensive.... plus theres heaps of great apartments to choose from.. :)

Grollo

October 11th, 2005, 12:49 AM

New project which will go on sale for the Commonweath Games period:

410 Elizaeth Street, 3 level addition to an existing 7 level office building, 38 metres high.

http://www.bdp-aust.com/files/VO5M4PXSAE/Elisabeth_hero2.jpg

http://www.bdp-aust.com/files/9WFU7BLFMT/050629-Town-Planning_Page_1.jpg

http://www.bdp-aust.com/files/4TZ65EB3T7/West%20elevation%20detail.jpg

http://www.bdp-aust.com/files/YAVF3HSBQT/West%20elevation.jpg

The Collector

October 11th, 2005, 02:54 AM

^^Great news!
A big improvement on what is there now. :)

tayser

October 11th, 2005, 11:31 AM

Grollo: I hate your ISP.

its webhost is so random!

edit: it's as if the webhost has some bandwidth metre on it - this site just sits there chugging along waiting for the image to come through.

:gaah: :)

tayser

November 10th, 2005, 10:30 PM

Melbourne is going to need more rental stock soon.

http://www.theage.com.au/news/national/rents-soar-as-housing-runs-low/2005/11/10/1131578172455.html

Rents soar as housing runs low

By Aileen Keenan
November 11, 2005

RESIDENTIAL rents are on the rise for the first time in five years, driven by a sharp fall in the number of Melbourne houses available.

Agents report rent increases of $10 to $20 a week in inner suburbs, and the head of property research at Macquarie Bank, Rod Cornish, has tipped solid rises next year.

Official vacancy figures to be released by the Real Estate Institute of Victoria today are expected to show a further decline in Melbourne's residential vacancy figures.

Inner-city vacancy rates peaked at 4.2 per cent in September 2004 but had fallen to 2.7 per cent by August this year.

A 3 per cent vacancy rate is considered a balanced market and the sharp decline is expected to put further upward pressure on rents.

Mr Cornish said the last apartments in Melbourne's high-rise construction phase would settle in the first half of next year and he predicted strong rental demand would pick up in the second half of the year after the supply was absorbed.

While reluctant to put a figure on the overall rise in rents in the cycle, Mr Cornish said the high number of immigrants choosing to settle in Melbourne and the trend for people to delay purchasing a home until well into their 30s was underpinning demand.

Mr Cornish said the rent cycle's upswing would be felt more in Sydney, where there had been little construction over the past 2½ years.

Adrian Jones, of Noel Jones Real Estate, said some rental managers had started reviewing rents and tenants had accepted increases of between 5 and 7 per cent without "blinking an eye".

Mr Jones predicted rents would rise by up to 10 per cent over the next 12 months.

He said the eastern suburbs company had 3600 properties under management and in the past year its vacancy rate had declined from 2.5 per cent to under 1 per cent.

There was strong demand for top-end properties that had suffered falls in rent of between 10 and 25 per cent two years ago.

He tipped rents would bounce back as demand was very strong for executive family residences.

"Traditionally the busiest time of the year for property managers is December and January, but this year offices have been overrun with quality applicants months earlier than usual," he said.

Andrews Corporation business and development manager Mariam McDonald said rents had risen by $10 to $20 a week in inner suburbs and in the city centre there was good demand for quality apartments.

This was despite a record number of 3090 apartments settling in the CBD, Southbank and Docklands this year.

Tim Nicoll, of Melbourne City Real Estate, said top-end dwellings in the city centre were commanding strong prices, with three-bedroom, two-bathroom residences renting for $800 to $1000 a week.

But when multiple high-rise towers had been released to the market at the same time it had resulted in a short-term decline in rents, he said.

_________

cmon Comm Games.

Wilko

November 11th, 2005, 02:47 AM

^^ I'm a residential property manager for an agent in Dandenong and we are getting super good rent's now like I have not seen before! Even down here in the South Eastern Burbs rental prices have increased dramatically even around my home bayside suburbs like Frankston.

In Frankston itself, a number of low rise appartment (6 - 8 story) towers have been approved but no construction as yet. Frankston seems to be booming at the moment in the retail sector, the CBD is starting to look great in some areas!

shrewd.user

November 11th, 2005, 04:04 AM

^^ demand is up ey? sounds goooood :)

A r c h i

November 11th, 2005, 04:27 AM

Bring on Tower VI @ Yarra's Edge. I'm looking forward to a silver tower and another Wood Marsh design.

shrewd.user

November 11th, 2005, 06:27 AM

damn you guys are in the know.... *googels tower VI*

A r c h i

November 11th, 2005, 07:11 AM

My comment was more in hope than anything else. ;)

tayser

November 16th, 2005, 05:37 AM

http://www.theage.com.au/news/national/house-prices-start-to-climb-again/2005/11/15/1132016797400.html

House prices start to climb again

November 16, 2005
Related coverage

AFTER a year-long correction Melbourne house prices are rising again, with a 4 per cent increase in the year to October.

A strong start to the spring auction season underpinned the market, with median values rising 5.5 per cent to $361,500 during September and October, according to property analysts Residex.

There were more auctions and higher clearance rates than at the same time last year.

Residex managing director John Edwards said Melbourne's residential market bottomed around July last year with a median value of $320,000. He described the 4 per cent rise in the year to October as very positive. Sydney's median value fell 0.6 per cent in the same period.

Mr Edwards said Residex figures represented about 75 per cent of all residential sales to the end of October. He said the rise in Melbourne's prices offset an over-correction during winter.

Grollo

November 16th, 2005, 10:12 PM

Melbourne residential vacancy rates down
11-Nov-2005
http://www.reiv.com.au/news/details.asp?NewsID=331

Melbourne’s residential vacancy rate decreased for the September quarter, down from 2.6 per cent to 2.2 per cent. The vacancy rate for Regional Victoria remained stable at 2.4 per cent.

The newly completed and previously untenanted inner-city apartment market (CBD, Docklands, St Kilda Rd and South Bank) dropped back from 4.7 per cent to 3.4 per cent.

The residential vacancy rate for inner Melbourne (0-4km from the CBD) dropped from 3.0 per cent to 2.5 per cent. Inner Melbourne (4-10km from the CBD) dipped from 2.8 per cent to 1.8 per cent. Middle Melbourne (10-20km from the CBD) rose marginally from 2.6 per cent to 2.7 per cent. Outer Melbourne (20km plus from the CBD) followed the general downward trend, reducing from 2.5 per cent to 2.0 per cent.

CEO Enzo Raimondo said “vacancy rates are reducing primarily due to lower levels of new high-density development and shows a return to residential property investment across the metropolitan area.

A three per cent vacancy rate is considered a balanced market. The drop in the vacancy rate to 2.2 per cent indicates a tightening in the rental market, which may put upward pressure on rents.

The low vacancy rate also confirms an increase in demand for quality rental accommodation in the metropolitan and regional areas.”

“The REIV’s September median price figures show signs of growth in the market, so we would expect to see vacancy rates remain low over the next 12 months as investors return to the market,” he said.

Geelong’s vacancy rate dropped slightly to 2.5 per cent, Bendigo’s fell slightly to 1.9 per cent, and Ballarat’s vacancy rate dropped to 2.2 per cent.

Mr Raimondo said “vacancy rates in the major regional centres of Geelong, Ballarat and Bendigo remain low, which is good news for investors.”

Vacancy rates for other Victorian regions consistently remain very low for the June quarter, with Wodonga (2.2 per cent), Wimmera (4.9 per cent), Shepparton/Goulburn (2.2 per cent), East Gippsland/Wellington Shire (3.0 per cent), Warrnambool/Western District (2.4 per cent), Latrobe Valley/South and West Gippsland (3.8 per cent), and Mildura/Mallee (2.3 per cent).

Marky Mark

January 31st, 2006, 12:30 PM

These Two were down for Melbourne .....nothing extremely exciting ...... and if we didn't already Know about them is Hard to Tell ?

The first:

Located in the prestigious suburb of Malvern, just under 10kms from the Melbourne CBD. This tree lined suburb has very few apartments and many
large houses that value well in excess of several million dollars. It has taken the developer several years to get this one through council, due to the
reluctance of the local residence to have apartments in this prestigious location that is predominately large established houses.

Yes, this will be another project that we will be able to offer to you prior to the local Melbourne agent marketing it.

· Prestige suburb close to the city

· Limited apartments in this location

· Very limited availability for any future projects, even if they are approved by local authorities.

· Expected release early to mid February

· Expected completion Mid 2007

· Just 67 apartments spread over 4 low level buildings

Spacious apartments:

1 bedroom apartments are around 54 to 65sqm internally plus 8 to 22sqm balconies or courtyards.

2 bedroom apartments are around 70 to 85sqm internally with 8 to 60sqm balconies or courtyards.

Priced from mid to high $300,000’s for one bedroom apartments.

Yes, we are currently agreeing terms with the developer for a rental guarantee for our clients.

We expect these apartments to have excellent demand on the local market once released locally as they should be attractive to both investors and
intending owner occupiers given the demand for this location and the lack of supply of apartment stock.

The second:

A stylish & modern apartment complex in the chic suburb of South Yarra

· Expected release any day now

· Expected completion late 07 early 08

· Just 2.5kms from the Melbourne CBD

· 96 apartments with an excellent mix of floor plans

· Fantastic city views

· Large apartments with big balconies

· One bedrooms from $347,000 (54sqm internally plus balcony and car park)

· Two bedrooms from $398,000 (from 60 to 75sqm internally plus balcony and car park)

· Large 2 bedroom plus study and 3 bedroom apartments with fantastic city views, from $545,000 to $1.1mil

Check out the demographics for this suburb:

· A suburb that has 48% of its population aged 25 to 49.

· A suburb of especially high income earners

· A suburb where 68% of residents are lone persons or couples without children

· A suburb where 64% of apartments are rented

· A suburb that since 1975 has outperformed metropolitan Melbourne in capital growth

· A suburb with limited remaining development sites.

And yes, we are just signing off on a rental guarantee at the market rate, around 4.5% (of the apartment price) gross rent.

A good cross section of stock is available with around 30% of apartments having already been sold by the developer to both local and overseas buyers. :)

Aussie Steve

January 31st, 2006, 10:46 PM

The one in Malvern is just off Malvern Rd in Elizabeth St. Its a very large development that is a max of 6 levels.

Icanseeformiles

February 1st, 2006, 03:46 AM

some nice proposals currently selling in Preston too.
I took a punt a few years ago and converted a big factory into a residence and have watched as slowly the area is becomming more vibrant and appealing. Still a way to go yet but it's good to see developments up and running on the city side of Bell St where I am.
Now just a few more trees please for the incredibly ugly High St and a few other main roads.

tayser

February 22nd, 2006, 05:18 PM

Rise of towers follows decline of nuclear family
Mark Phillips
23 February 2006
Australian Financial Review

DOCKLANDS: 10 YEARS ON

The dozen or so high-rise apartment buildings in Melbourne's Docklands precinct stand as monuments to the power of the investment property boom of the first years of the decade.

To critics, the apartment towers symbolise everything that was wrong with a property bubble fuelled by low interest rates.

As the Melbourne apartment market began to head southwards in the middle of 2003, it unleashed a flurry of litigation by investors who had bought off-the-plan apartments at Docklands.

Mirvac, developer of the Yarra's Edge precinct, bore the brunt of the legal action.

But the developer yesterday celebrated victory in an important test case when Justice Kim Hargrave in the Victorian Supreme Court dismissed a claim by a Melbourne man that he had been induced into buying an apartment by misrepresentations and unconscionable conduct by Mirvac.

Docklands apartment sales peaked in 2001 and 2002 at the same time as the broader Melbourne market, according to research by Charter Keck Cramer.

A total of 1549 apartments were sold off the plan in the Docklands precinct in those two years, making up just over a quarter of all apartment sales in Melbourne's central city region that year. But in line with the overall apartment market, off-the-plan sales in Docklands have fallen dramatically since the second half of 2003. Just 44 were sold in the first half of 2005, for example. In the middle of last year, Docklands had the highest stock overhang of completed apartments in any central Melbourne precinct, with 155 apartments unsold.

Between 2002 and now, the precinct's residential population has grown from 300 to about 6300, and will eventually reach 20,000.

To some extent, the growth of residential living in Docklands has reflected the shift towards inner-city apartment living in Melbourne.

Property analyst Charter Keck Cramer estimated that there were 19,750 off-the-plan residential apartment sales in the five inner-city precincts - the CBD grid, CBD north, Docklands, Southbank, and St Kilda Road - between 1994 and the first half of 2005. They peaked in 2001, when there were 3494 sales, 747 of them in Docklands.

Sales have since fallen as the market underwent a correction. But demographer Bernard Salt from KPMG said Docklands apartment living was an unstoppable force over the long term as the traditional nuclear family declined as a social institution.

The Docklands developers understood this, even if critics did not.

"As we move more and more towards singles and couples and DINKs [double income, no kids] and gays and one-parent families and empty nesters, you would have to expect the housing stock in Melbourne to reflect that," he said.

"Just as there's entire suburbs given over to the family, there needs to be the invention of entire suburbs given over to the new social institutions and that gives rise to places like Docklands and Southbank."

The director of residential prestige and projects at Charter Keck Cramer, Anthony Rohan, said concerns about an oversupply of apartments in Docklands were overstated, and he believed rental yields were improving for investors.

At the beginning of October, the vacancy rate for Docklands apartments was 3.5 per cent and average weekly rent was $455, for an estimated gross rental yield of 4.3 per cent, according to state urban development agency VicUrban.

Yields and weekly rents have fallen over the past three years as more stock has become available in the precinct.

In 2004, average rents were $486 a week and yields were 4.9 per cent; and in 2003 the yield was 5.6 per cent from weekly rents of $493.

Mr Rohan also disputed the common perception of Docklands as being dominated by investors, pointing to prestige buildings like Mirvac's Tower 5, which was almost all sold to owner-occupiers.

However, because of existing remnant stock and high construction costs, Mr Rohan anticipated a slow take-off of new residential construction over the next few years.

Lend Lease has decided to plough ahead. Its Dock 5 building is now 80 per cent sold ahead of completion early next year, and it will launch a $40 million, nine-storey residential development, known as Mosaic, this month.

The first apartment building to be completed at Docklands was MAB Corporation's Arkley tower at New Quay in late 2001. New Quay now consists of about 1000 apartments in six buildings as part of an overall mixed use development with an eventual value of $1 billion.

Paul McDonald, MAB'S chief executive, was unconcerned at the potential for an apartment glut at Docklands. He said population growth dictated that Melbourne would need about 25,000 new dwellings a year for the next decade.

"The fundamentals of population growth are there and we're optimistic," he said. "I would expect most people to be planning for their next tower and readying for the upturn."

Hanging over the residential market are the mandatory milestones built into the development agreements with the Docklands Authority to ensure the precinct continues to be built at a steady pace.

Fortunately for the developers, there is some flexibility to allow for fluctuations in demand.

"Obviously, the residential market has cooled somewhat, and [developers'] milestones are catching up to their progress, and that's something we will be assessing," Docklands general manager Michael Hynes said.

Off-the-plan apartments in Docklands have averaged $539,000 since 2000, for a total sales value of $1.4 billion.

An analysis by VicUrban of 144 resales of Docklands apartments found average annual capital growth of 5.9 per cent. Forty per cent of sales have resulted in gains of between zero and 5 per cent a year; 22 per cent lost value. The average resale price was $517,000.

Research by Australian Property Monitors found there were 123 apartment sales in the Docklands postcode (3008) in 2005 for a median price of $458,000. The median price fell by 7.5 per cent last year. Based on intentions by buyers at the time of purchase, 59 per cent of the apartments were investments.

MAB has also detected a growing trend of owner-occupiers moving to Docklands now they can see the finished product. Mr McDonald said they now averaged about 30 per cent across the entire precinct.

"That's a function of people visualising it as an attractive place to live," he said.

Margaret Crump, a resident at Mirvac's Yarra's Edge, moved from the eastern suburbs three years ago to cut commuting time.

"I can't imagine living anywhere else, I'm not a gardener," she said.

___________

At last: Docklands slowly comes to life
Mathew Dunckley and Mark Phillips
23 February 2006
Australian Financial Review

Ten years ago, it was a wasteland of empty warehouses that even taxi drivers feared to go near. But today, following $3.7 billion of investment, Melbourne's Docklands is a bustling residential and commercial precinct with a daily population of 32,800.

Docklands is still a work in progress, and some scepticism remains about its prospects as dozens of high-rise apartments sit unsold.

But the more recent transformation has silenced most of the critics who a decade ago voiced doubts about the wisdom of proceeding with the largest urban revitalisation project in Australia.

From the sports stadium, which celebrated its 10 millionth patron in August, to the rows of apartment towers in New Quay and Yarra's Edge, to the acclaimed National Australia Bank HQ in Victoria Harbour, Docklands is taking shape as it moves towards eventually doubling the size of Melbourne's central business district.

"You couldn't stop Docklands today if you tried," says John Tabart, the outgoing chief of VicUrban, which manages the precinct on behalf of the state government.

"It has mixed use and is a high-quality venue. Much of Melbourne doesn't realise that yet."

The connection of Bourke and Collins streets could be just a few years away, altering Melbourne's grid street system in a way never envisaged by the city's original planners and symbolically linking Docklands to the CBD.

Located on partly reclaimed swampland at the west of the CBD, Docklands was Melbourne's original port, operating from the early 1900s until the mid-1990s, made obsolete by the requirements of container ships.

It begins at Spencer Street Station and Batman's Hill - the highest point of early Melbourne - extending to the Bolte Bridge.

Running parallel to each other through the CBD, Collins and Bourke streets have already been extended into Docklands and will eventually meet as the apex of a triangle deep in the Victoria Harbour precinct.

Mark Birrell, who was major projects minister in the first Kennett government when the Docklands vision was formalised, admits to an "ongoing parental interest" in the precinct. "This was a site that taxi drivers would not take you to for fear of the consequences," he says.

"It's [now] become a must-visit place for tourists, and people enjoy the restaurants and literally thousands of people are living there."

Docklands is one of the world's largest urban revival projects.

According to VicUrban's figures, investment at Docklands is running at an average of $500 million a year.

About $3.7 billion of development has been completed or is in construction. It hosts more than 6000 permanent residents, 6500 daily office commuters and averages 15,000 daily visitors, according to VicUrban.

When completed by about 2020, the Docklands development will have in effect doubled the size of Melbourne's city centre.

The doubters remain.

Ten years into what will be a 20- to 25-year project on a 200 hectare site on the western edge of Melbourne's CBD, the pace of development has slowed. Huge swaths of land are still barren, and the precinct has borne the brunt of criticism for the overheated residential property market of the early 2000s.

Little apartment building is planned for the near future as the market still absorbs the 2654 already built and 696 under construction.

At the beginning of October, the vacancy rate for Docklands apartments was 3.5 per cent and average weekly rent was $455, according to VicUrban.

VicUrban says there have been 144 resales of Docklands apartments for an average price of $517,000 and annual capital growth of 5.9 per cent, but 22 per cent have lost value. Forty per cent of sales have resulted in gains of between zero and 5 per cent a year, while 22 per cent lost value.

The area has received a boost in the past two days, with the state government awarding the contract for a $1 billion convention centre on Docklands' doorstep and also announcing in-principle support for a $60 million ice-skating centre at Waterfront City.

The precinct also received a lift last year when ANZ Bank announced it was looking for a new 80,000 square metre campus-style office space to house most of its Melbourne operations.

Victoria Harbour is regarded as a frontrunner for that deal and is "the jewel in the crown", according to Docklands general manager Michael Hynes.

Lend Lease has already taken a gamble on that status by beginning construction of its first residential tower, Dock 5, in the middle of last year at the height of negativity towards Docklands.

Lend Lease Victoria Harbour project director Maurice Cococcia acknowledges that the pace of sales at the project will not match those experienced by MAB and Mirvac who were selling at the height of the boom.

"Most of the developers have probably only been here for six or seven years and in that short period, [to have the current level of development] in a relatively untried and untested part of Melbourne is a great testament to that strategy," he says.

Despite fears in the early days about contamination, the biggest logistical issue has been coping with the Coode Island silt, which he says required more engineering work on building foundations.

Certainly not everything at Docklands has been a success. The $110 million Central City film studios, a private consortium chaired by movie distributor Sino Guzzardi, in the most north-western precinct, opened eight months late in February 2004, $7.4 million over budget and without electricity.

Since then, it has been the setting for the features Hating Alison Ashley, The Extra and the Nicolas Cage feature, Ghost Rider, but the jury is still out on whether the studios will attract enough top local and international productions to be viable. Nevertheless, a $7 million expansion began last year.

For the developers who moved into the early stages of the project, Docklands was a huge gamble.

"It was certainly pioneering territory," says Paul McDonald, chief executive officer of MAB Corporation, which will eventually invest more than $1 billion in its New Quay precinct at the northern end of Docklands.

Tabart says the well-publicised stoushes with unsuccessful developers were the low points of his 10-year reign but he stands by the authority's approach.

"Our agreements have to be hard-nosed business arrangements that require a developer to build at a time when there is no market. They win a bid with a design and a price and a time frame; [if they miss] they can lose their rights over the land."

Now, almost at the halfway stage of the Docklands experiment, all the precincts are ahead of their required development timetables, he says.

Demographer Bernard Salt of KPMG says Docklands' future is assured because of major social changes that are undermining the traditional nuclear family.

"Docklands does serve a niche in the sense that it offers something that has not been offered previously in Melbourne - water-based apartment accommodation adjacent to the CBD," he says.

Damian Trytell, principal of the Mecca restaurant group, says that in just three years, Docklands has become one of Melbourne's leading restaurant and entertainment precincts. His Livebait and Mecca Bah were among the first venues to open at New Quay in November 2002.

"We have generally run 27 per cent above what we budgeted in the early stages of our five-year business plan," he says.

Only one business at Docklands has been forced to close - a nightclub that Trytell says was inappropriate for the precinct.

The Docklands Authority and its successor were required to borrow to fund infrastructure under their establishing legislation - that debt stands at $150 million. Providing that infrastructure was a key to luring private investment, Tabart says.

The first project to use the model was the $400 million stadium. The then Docklands Authority assisted with $65 million worth of bridges and roads.

The roofed stadium - now known as Telstra Dome - is home to the AFL and has given Docklands a strong identity as the western fringe of the CBD through the exposure gained from the close to 10 million football supporters who have passed through its gates.

There is bipartisan political support for the project, although the Liberal opposition continues to criticise the merger of the Docklands Authority with the Urban Land Authority to form VicUrban. VicUrban believes that over 20 years Victoria will make a profit on Docklands.

The opposition's major projects spokeswoman, Louise Asher, says some delays and cost overruns have not affected the Liberal Party's backing of the development.

But there are those who do not share VicUrban's optimism. A professor of architecture at Melbourne University, Miles Lewis, a long-time sceptic of Docklands, says the precinct's shape is an opportunity lost.

The Bolte Bridge bridge was built too low to allow for cruise ships so, for example, unlike Sydney's Circular Quay, tourists cannot be dropped in the heart of Melbourne's new waterfront.

He also describes the building design as "low-rate".

Asked to nominate a positive, Lewis cites the extension of Collins and Bourke streets and the quality of the restaurants.

But Mark Birrell remains an enthusiastic believer in the Docklands and dismisses criticism of the project. "It's just the same thing every year, but they sell, they work and are in the high end of quality."

Marky Mark

February 27th, 2006, 03:42 AM

Residential Tower of 204 Apartments somewhere behind the Casino , the advertisement is for the Block of Land and approved Plans ! Be nice to see sold and developed sooner rather than Later ! :)
Has anyone seen it before ?

http://needproperty.com.au/listman/listings/images/50_2.jpg :cheers:

Grollo

February 27th, 2006, 03:48 AM

42-48 Blaston Street, 34 levels, 113m high. See Emporis.com for more renderings.

Muse

February 27th, 2006, 07:24 AM

No wonder it wasn't under "Blaston"...

42-48 Balston (http://www.emporis.com/en/wm/bu/?id=149769)

Marky Mark

March 5th, 2006, 11:59 PM

But the Fab Brady Group are advertising for a Construction Manager to oversee the design and construction of a new 16 Level Apartment Building for Melbourne , does anyone know where this one is going ? Ha Ha we know what it is going to look like ! :)

wowsim

March 22nd, 2006, 02:18 AM

Another typical anti-melbourne article from the Australian, do they realise they've lost 20% of their melbourne subscribers in the past year?

note the lack of anything other than anecdotal evidence, and opinion, and the fact that the headline is almost opposite to what the text of the article says...did anyone read the story before they put a headline on it?
Gee 2% vacancy in the Docklands....Che Disastro!

No end in sight for southern flat glut
Maurice Dunlevy
March 22, 2006

MELBOURNE'S apartment glut is set to worsen following claims yesterday that 3100 apartments are due for completion this year, despite falling values.

Charter Keck Cramer director of strategic research Robert Papaleo said that while the market continued to "tread water" after 2500 apartment completions last year, the number of completions forecast for 2006 meant it was still not out of the woods.

Mr Papaleo said there was anecdotal evidence the market was "holding its own", and developers had applied the brakes to new projects.

He said this year's 3100 completions would be followed by sharp declines in 2007 and 2008.

While that decline in completions would ease the apartment oversupply over the long term, it would not provide any immediate relief to owners who were holding on to their apartments in the face of falling values.

Mr Papaleo said strong rentals, on the back of an equally strong economy, had nevertheless held up the investment end of the market.

While values had fallen generally, property transactions did not show evidence of a price crash.

At Docklands, where falling property values have resulted in disgruntled buyers taking legal action against developers Mirvac and Morry Schwartz's Pan Urban, rental vacancies are understood to be running at only 2 per cent. "Sales in some buildings are positive, but others are marginal," he said.

Mr Papaleo said the fall in off-the-plan sales had left developers carrying a "fair load" of unsold stock.

He said most were holding the line, selling on their terms, but as demand had clearly fallen away it was unclear how long that would continue.

Wakelin Property Advisory director Paul Nugent said there was still negative sentiment towards off-the-plan apartments.

Mr Nugent said he wouldn't advise clients to buy because it was obvious apartment prices were too high and too many had been built.

He said the hype that had surrounded the sale of the recent crop of apartments was gone, and investors had been left with properties worth far less than the "artificial prices" charged by developers.

Mr Nugent said conditions would eventually improve as the market absorbed the oversupply, but that could take a number of years.

The residential property analyst said that while he advised investors against apartments, he understood that some wanted to buy luxury apartments to live in during retirement.

"It's a different scenario when somebody buys with plans to live there down the track, maybe in one, five or 10 years," he said.

wowsim

March 22nd, 2006, 02:22 AM

Hahaha....in the same edition....wait for it....

City apartment glut over as starts slump
Anthony Klan
March 22, 2006

THE Melbourne and Sydney inner-city apartment glut is over, with the number of apartments being built taking the biggest tumble in more than decade outside the collapse following the GST.

Apartment construction starts fell 16.6 per cent in the December quarter, dragging down total residential building starts by 7.5 per cent as weak investor demand continued to slug the market.

In the December quarter of 1995, apartment construction starts fell 17.2 per cent, worse only in the September quarter of 2000, when building starts fell 31.1per cent.

"The oversupply of inner-city apartments, which has been most pronounced in Sydney and Melbourne, is over," said JP Morgan economist Jarrod Kerr.

But he said investors were not expected to go back into the property market as rental yields were low - 2.7 per cent net in Sydney - and home prices were expected to remain flat for at least the next 12 months.

Affordabilty also remained a major problem.

According to the Australian Bureau of Statistics, the number of new detached houses to begin construction, adjusted for seasonal variations, fell by 2.9per cent in the quarter to 25,060.

Housing Industry Association chief economist Harley Dale said the fall in apartment starts had been larger than expected.

"It's a significant fall and it seems to be a similar story across the country," he said.

The soft apartment commencements were led by Western Australia - indicating the property boom in that state was coming to an end - and NSW.

Both states recorded a 36per cent slump in apartment commencements in the quarter.

But in some welcome news for NSW, figures released yesterday showed population growth in the state was at its strongest in almost three years. In the September quarter, NSW had an annual equivalent population growth rate of 10,826.

The low national building commencement figures follow softening in the number of houses and apartments approved for construction early last year. Last March, apartment approvals slumped 21 per cent across the country, with NSW approvals almost halving.

CULWULLA

April 12th, 2006, 01:23 AM

article in todays fin rev about a twin tower/17st with a 30m high sales office in st kilda ? to boost sales? bectam group?

Grollo

April 12th, 2006, 01:29 AM

That is the Becton Eastside developement. The elevated sales office is U/C and is in Jolimont not St. Kilda ;-)

CULWULLA

April 12th, 2006, 03:38 AM

^ thanx, yeah had a quick glance from over a guys shoulder. thus the guess.
A 30m sales office, i wonder what it will look like? i suppose they can show what views are gloing to be like. thats if you can access the height?

http://img217.imageshack.us/img217/884/culchie0js.jpg

Grollo

April 12th, 2006, 04:23 AM

It a box on five tower crane bases with an encolsed buildiers lift, it was scheduled to go up yesterday but won't be completed for a couple of months yet. Shouldl be able to get some pretty awesome pics from up there.

Londoner

April 15th, 2006, 10:41 PM

"High-rise downturn hits apartments

Maurice Dunlevy April 15, 2006

FOR the Melbourne apartment market, sale advertisements say it all.

"Make an offer" ... "sacrifice sale" ... "buy of the century" ... are usually the stuff of secondhand car yards, not homes with the million-dollar asking prices of some of Melbourne's most expensive towers.

But that's exactly what's happening in the three main apartment precincts of the CBD, Southbank and Docklands as off-the-plan buyers caught up in the high-rise apartment downturn consider baling out.

At Eureka Tower, the still to be completed 88-storey complex at Southbank, a mid-level apartment that cost the owner almost $900,000 in 2000 is about to be sold for $950,000.

Hardly a fire sale, but nevertheless not a profit when holding charges, agent fees and government charges are taken into account.

Typical of the lower end of the market is another Eureka resale where an apartment purchased in February 2000 for almost $312,000 has a $369,000 asking price.

At the Docklands, a two-year-old apartment bought off the plan for $745,000 is being offered for $760,000.

Without reliable resales data, much of what is happening is anecdotal.

But according to agents who specialise in the sector, selling now would expose many owners of top-end apartments to losses in the order of $200,000-$250,000 ...."

http://www.theaustralian.news.com.au/story/0,20867,18783329-25658,00.html

CULWULLA

April 16th, 2006, 09:22 AM

yes, its been coming, but i think the smaller projects, especially in Docklands and st kilda rd will still power on. It might be a while before we see a major resi tower in CBD/sthbank.
There has been aprx 30 apartment towers erected since 2000,. amazing really.

Grollo

April 16th, 2006, 09:55 AM

much of what is happening is anecdotal.

That sums up this article nicely.

If you actually look at the figures the median apartment price in Melbourne rose by 2.9% in 2005 while the median house prices fell by 1.4%.

http://www.reiv.com.au/news/details.asp?NewsID=352

Londoner

April 16th, 2006, 02:06 PM

But as is pointed out in numerous articles, medians can be deceptive. My hunch would be that the mix has changed: go back to 2002-3 and Central Equity were churning out hundreds of (relatively) low cost units. Now is there much else apart from Neo 200 in this market segment?: I'd got the impression that the average Docklands unit is significantly more expensive which would explain the move in the median.

mugley

April 22nd, 2006, 08:12 AM

A 30m sales office, i wonder what it will look like?Here you go. Any secret Rebel bases in East Melbourne are in big trouble :)

http://static.flickr.com/47/132715083_dbe725e21b_o.jpg

Edit: it's not a sales office, it's an "experience suite" (http://www.becton.com.au/eastmelbourne/media/pdf/OneEastMelbourne-FactSheet.pdf). Silly name but I'm still keen on getting up there.

CULWULLA

April 22nd, 2006, 12:14 PM

^ what a classic, thanks mugs.never seen anything like it. must really want to sell.
cheers

Drunkill

April 22nd, 2006, 12:17 PM

Impressive...Very Impressive.

Grollo

April 23rd, 2006, 05:26 AM

They have built such an exepnsive display suite because the tower will have Superb views that you can't really see from ground level, it is a unique location and these will most likely be the most expensive apartments in Melbourne.

Garmatt

April 23rd, 2006, 11:36 AM

Yeah, I'd pay through the nose for views of the rail yards!
I'd say there are loads of other sites in Melbourne that have better views than this...
(a) Esplanade hotel
(b) Anywhere on St. Kilda Rd.
(c)Yarra's Edge....
the list goes on.

A r c h i

April 25th, 2006, 12:25 PM

Anyone seen this before? It's called Montage and is designed by Hassell.

http://www.hassell.com.au/siteImageStore/DoncasterHill_crop.jpg

Apparently it's going up in Doncaster. Reminds me of Habitat in Montreal.

http://data.greatbuildings.com/gbc/images/cid_aj2010_b.jpg

Marky Mark

April 25th, 2006, 12:40 PM

I don't think its ganna happen , unless someone else knows something , has a sign up saying a certain amount has been sold , which has been graffited over with 200 left LOL Would be great if it did , she would look awesome on Doncaster Hill , and the views would be superb ! :cheers:

The Collector

April 25th, 2006, 12:41 PM

^^The site for that Doncaster apartment block has been sitting idle for years. :bash:
I hope you are right Archibomber, because I just luurrvve that design. :)

CULWULLA

April 25th, 2006, 01:02 PM

hmmm, shoebox architecture.
reminds me more of Sirius in the Rocks,>
http://img154.imageshack.us/img154/9403/sirius5qh.jpg

Favco750

April 25th, 2006, 01:18 PM

exactly what I was going to say, the joint near the bridge, but I didn't know the name of it..........

A r c h i

April 25th, 2006, 02:27 PM

All it says on Hassell's site is 'Completion: In progress.' Now if only Fountainhead were here.

tayser

April 27th, 2006, 12:25 AM

AFR
Storey behind builders and union stoush
Mathew Dunckley
27 April 2006

The Victorian government's much vaunted urban planning blueprint could be derailed by a brawl between leading builders and union groups over the cost of apartment building.

The government's Melbourne 2030 policy encourages more higher density development to cope with an expected 620,000 new households over the next 25 years. But builders and industry bodies argue rules requiring union involvement in such projects are making construction costs prohibitive.

While the government wants 41 per cent of the new apartments to be built around suburban shopping centres, to reduce urban sprawl, developers say the so-called "three-storey" rule - which triggers union involvement on such projects - is adding at least 30 per cent to construction costs.

Formalised in many of the enterprise bargaining agreements covering the industry, the rule deems buildings at or above three-storeys to be commercial projects and so are subject to union workplace arrangements.

Many developers, building contractors and planning consultants were willing to confirm the impact of unions on the viability of projects but many did not want to speak out publicly.

One prepared to outline concerns was Australand residential executive general manager Peter Burke, who said Melbourne 2030 could not succeed unless buildings of up to six storeys could be built without union labour.

"The government says it wants to consolidate the urban spread into more tightened areas but until you can build something at a profit, no one's going to do it. It's as simple as that," he told The Australian Financial Review.

"There needs to be a realisation that once unionised costs are involved then anything above three storeys . . . is prohibitive."

Faced with the costs many developers either walk away from proposed developments or propose taller and taller apartment buildings to boost their returns.

Mr Burke said proposals for towers in outer suburbs like Mitcham were unlikely to be built because the apartments would have to be priced far ahead of the local real estate market.

The government desperately wants to see lower rise buildings proposed to head off growing community unease and criticism of the strategy that it is a green light for high-rise development in the suburbs.

But the economic difficulty of getting a low-rise apartment development out of the ground is revealed in an analysis for the AFR by property consultants and valuers Charter Keck Cramer.

Of the more than 2000 suburban apartment projects completed in Melbourne since 1990 - about 90 per cent of all projects of more than 10 units - the number of completions nosedives above three storeys.

In that 16-year period there were 249 three-storey developments for 5682 apartments, almost double the number of four-storey projects (142 developments for 4578 apartments) and dwarfing the 53 projects at five storeys tall (for 2180 apartments).

The figures taper off from there down to just eight seven-story buildings across all of Melbourne yielding just 357 apartments.

One of Melbourne 2030's key architects and a continuing adviser to the government, RMIT associate professor of planning Michael Buxton, said the community tended to view anything more than seven storeys as high-rise and the government's density aims could be easily achieved through smaller buildings.

"We don't need to be going into 10, 15 or 20-storey towers in order to achieve significant increases in residential density," he said.

"You can achieve quite easily site density of 35 to 40 dwellings per hectare with three to four storey development. You can get really significant increases in densities with four to six storeys.

"Barcelona is one of the densest cities in the world and there is barely a building over six or seven storeys."

Monash University Centre for Population and Urban Research director Bob Birrell and Housing Industry Association executive director Graham Wolfe said construction costs in "activity centres" such as suburban shopping centres were one of the major obstacles facing Melbourne 2030.

"I'm not sure that the planning minister is fully aware of the cost implications that this has on apartment building and therefore the impact on Melbourne 2030," Mr Wolfe said.

Labour costs were a far greater proportion, at about 45 per cent, of the expense of building an apartment compared to a house in a traditional subdivision. Therefore, the sector was much more sensitive to union involvement, he said.

Villawood managing director Rory Costelloe said companies did not want to complain publicly for fear of provoking a costly fight with the unions.

"I've no problem with unions per se but the way they work is very expensive," he said.

"It's common knowledge that the [rule] blows your costs out."

Construction, Forestry, Mining and Energy Union state secretary Martin Kingham said apartment projects were different to greenfields developments and were commercial ventures.

The higher labour costs reflected the greater technical difficulty and safety standards needed on taller buildings, he said.

He said union involvement meant a 28 per cent premium on basic award rates but that the result was improved safety and a better quality product.

More than 2500 construction companies had signed off on enterprise bargaining agreements with a "three-storey" rule clause, including Australand, he said.

"These developments are very commercial projects. They're like an office block. They're being built for a profit," he said.

Mr Kingham said the union was a supporter of the Melbourne 2030 strategy as it would save the state money on infrastructure provision and allow people to stay in their suburbs as they got older.

He denied the union had any intention of moving into domestic building spheres. "The union is not setting its sights on free-standing homes on the traditional quarter-acre block.

"We're in the commercial sector. We're concentrating on where we can most make an impact," he said.

Some development sources argued the state and federal governments should act to formally remove unions from domestic building sites under six storeys.

But Victorian Planning Minister Rob Hulls, who is also Industrial Relations Minister, said in a written statement that Melbourne 2030 was working and it was not his role to intervene in commercial arrangements.

"Developers would be outraged if government dictated to parties what should and should not be in their employment agreements," he said.

He pointed to projects in Elsternwick, Mooney Ponds, Doncaster, Brunswick, Mornington and Footscray as examples of the government's strategy working.

He cited a record level of building permits worth $15 billion for the second consecutive year in 2005, including a 6.3 per cent rise in residential building permits, as proof of a healthy building industry.

___________

How can Devine, Metricon and every other sprawler suburban shite development NOT be a commercial project? :nuts:

Grollo

April 27th, 2006, 01:06 AM

"Barcelona is one of the densest cities in the world and there is barely a building over six or seven storeys."

Wrong! Barcelona has more skyscrapers than Melbourne and many more in it's suburbs.

Barcelona has 403 skyscrapers (12 levels+ or 35m) in the inner city area and 270 in it's suburbs. Melbourne has around 450 in the inner city area and only around 25 in it's suburbs. There would be hundereds more buildings between 7 and 12 levels in Barcelona as well.

There are also around 50 more skyscrapers under construction across Barcelona and many more planned.

Grollo

April 27th, 2006, 01:17 AM

Anyway, do we really Melbourne to look like this:

http://www.econ.ucla.edu/ackerber/Im000425.jpg

or this:

http://img107.echo.cx/img107/9834/crifromsouth6ot.jpg
?

CULWULLA

April 27th, 2006, 02:36 AM

hey whats wrong with chatswood.lol
i think its a great little satelite city

Grollo

April 27th, 2006, 02:37 AM

That was my point actually :-)

Melb_Rulz

April 27th, 2006, 02:46 AM

wheres the second photo of?

mic

April 27th, 2006, 02:50 AM

hey whats wrong with chatswood.lol
i think its a great little satelite city

NOTHING....It really is somthing that Melbourne should aim for.

What I dont understand is why can Sydney produce/build such great urban centres, but it seems to be such a struggle to get Melbourne 2030 up and running?

Why is there so much opposition from Melburnians when most of what is being planned is positive and addresses the under utilised land surrounding suburban centres, which are often just surface car parks? Do people think surface car parking is more desirable than a fully intergrated urban centre?

jlb

April 27th, 2006, 04:02 AM

NOTHING....It really is somthing that Melbourne should aim for.

What I dont understand is why can Sydney produce/build such great urban centres, but it seems to be such a struggle to get Melbourne 2030 up and running?

Why is there so much opposition from Melburnians when most of what is being planned is positive and addresses the under utilised land surrounding suburban centres, which are often just surface car parks? Do people think surface car parking is more desirable than a fully intergrated urban centre?
melbourne has too much greenfield land, the only way to discourage the use of it is to make it more economically viable for infill development. Given that the state government is working on introducing development levies for greenfield infrastructure (as sydney already does with 'betterment capture levies') it should become less attractive to buy property on the urban fringe. Also the other thing with sydney is there's not any other choice but to increase density, there's not much land left.

Aussie Steve

April 27th, 2006, 04:20 AM

Grollo, you are right, I don't want Melbourne to look like Barcelona. I want cities within a city, as Mr C said.

What I dont understand is why can Sydney produce/build such great urban centres, but it seems to be such a struggle to get Melbourne 2030 up and running?

Why is there so much opposition from Melburnians when most of what is being planned is positive and addresses the under utilised land surrounding suburban centres, which are often just surface car parks? Do people think surface car parking is more desirable than a fully intergrated urban centre?

The people at fault are the local councillors and nimby residents.

tayser

April 27th, 2006, 09:08 AM

Towers on top of shopping centres & lifeless streets versus vibrant streets and intense low-rise development..... neither really, but more a mixture between the both with more of the lower-rise in the burbs where there's more chance of it being successful and higher in more central areas where the market currently caters for it.

Chatswood? You've got to be kidding me :|

Where's blabby when you need him.

tayser

April 27th, 2006, 10:20 PM

Just what the doctor ordered!

Australian Financial Review

Sanderson to head VicUrban
Mathew Dunckley
28 April 2006

Pru Sanderson has been appointed as head of the Victorian government's urban development body, VicUrban, taking charge of more than $12 billion worth of projects.

Ms Sanderson will leave her role as chief executive of Monash Property Management, which runs Monash University's $2 billion property portfolio in Australia and overseas, to join VicUrban in June.

Ms Sanderson replaces John Tabart, who resigned from the position to take up a job in Dubai.

The ongoing development of the $10 billion Docklands precinct will perhaps be her highest-profile responsibility.

She was not available for comment last night but said in a written statement: "I am looking forward to continuing the industry leadership role VicUrban plays in the development and property sector.

"VicUrban is the ideal organisation that looks to balance strong development growth with important public outcomes."

Ms Sanderson holds an honours degree in architecture from the University of Melbourne and has worked on several major state projects, including the Melbourne Museum, the Australian Grand Prix(as manager of engineering) and Federation Square.

She has also held senior project management positions with the Melbourne and Whitehorse councils.

In a press interview during her time at Whitehorse Council, she was quoted as saying she enjoyed working in the heart of Melbourne.

"I'm an intensely urban person who loves having a role in how people live in cities," she reportedly said. "I want to help people enjoy this wonderful city."

VicUrban chairman Tony Darvall said Ms Sanderson was an accomplished leader and had extensive experience on a number of large infrastructure projects in Australia, Malaysia and South Africa.

Her appointment was approved by the Minister for Major Projects, John Lenders, following a recommendation by the VicUrban board.

It is a position that has attracted plenty of controversy in recent years.

In 2001 Brisbane developer Jim Reeves was appointed to the job but resigned following the so-called "jobs for mates" scandal over his links to Premier Steve Bracks.

The position was then filled by Mr Tabart, whose $400,000-plus salary copped plenty of flak, particularly from the opposition, for being one of the top-paid public positions in the state.

Ms Sanderson will be paid at the same level, which the opposition spokesman on major projects, Louise Asher, said could not be justified. "There is no way known that the most important public servant in Victoria is the head of VicUrban," she said.

A spokesman for Mr Lenders said Ms Sanderson had a record of achievement working at very senior levels on a number of major infrastructure projects and was well-qualified for the role.

KEY POINTS

*Pru Sanderson replaces John Tabart, who is going to Dubai.

*She has an honours degree in architecture.

*The opposition has criticised her $400,00-plus salary.

tayser

May 3rd, 2006, 06:32 PM

http://www.theage.com.au/news/business/renters-will-pay-more-as-vacancy-rates-approach-record-lows/2006/05/03/1146335804203.html

Renters will pay more as vacancy rates approach record lows

By Ben Schneiders
May 4, 2006

RENTS are set to jump further as vacancy rates across Melbourne hit or stay near record lows for this property cycle and as the market absorbs the glut of developments built during the recent boom.

Evidence is emerging of more tenants having their rents raised, according to the Tenants Union of Victoria. Agents confirm that rents have started to rise. Some forecast that they might increase by more than 5 per cent over the next year — or close to twice the rate of inflation.

Data obtained by The Age shows that the vacancy rate across Melbourne was 1.8 per cent in March, about half the rate in January 2004.

"Any time the vacancy rate is at this level it puts pressure on rents," said Greg Hocking from agents Hocking Stuart.

It also seems that the glut of unlet new apartments and housing in inner Melbourne is finally starting to contract. Vacancy data compiled by the Real Estate Institute of Victoria shows that the rate for inner Melbourne — even once properties that have never been let are included — has fallen sharply in recent times.

It now stands at 3.1 per cent, compared with the 10.9 per cent vacancy rate at the start of 2004, when nearly one in nine rental apartments and houses within four kilometres of Melbourne was vacant. That area includes the CBD, Docklands, St Kilda Road and South Bank.

Michael Yardney of Metropole Properties said high rates of migration were a factor in the falling vacancy rates as people moved to Victoria in search of work. Nearly 32,000 migrants moved to Victoria in the year to September 2005.

"There's no likelihood of that changing in the future; it's only going to get lower," he said of the vacancy rate. "The low vacancy rates are great news for investors who have not been able to increase the rents on their investment properties for a number of years.

"Many investors have had to decrease their rentals to 'meet the market' and minimise vacancies over the past few years."

Mr Yardney expects rents — which, according to one survey rose 4.5 per cent in the December quarter on a typical Melbourne house — to rise at least a further 5 per cent this year.

REIV chief executive Enzo Raimondo said the rise in interest rates could cause vacancy rates to fall even further as people put off house purchases and remained renters. That could put more pressure on rents, he said. "Unfortunately, that means the rate rise could be bad news for renters too."

Peter Jones, chief economist at Master Builders Australia, said the higher rates would deter investors and lead to a rise in rents.

________-

I doubt it'd take much for CE/PDG/Baracon/Becton to start cranking up again.

Grollo

May 4th, 2006, 01:08 AM

REIV March Quarter figures show Victorian Property Market in steady growth phase
28-Apr-2006

...“The apartment market is still stronger than the house market, not only did the quarterly result increase but the yearly median increased by 5.3 per cent.

“Melbournians are continuing to be enthusiastic about living in units and apartments."

tayser

July 1st, 2006, 12:34 AM

Melbourne residential market starting to warm
Mark Phillips
28 June 2006
Australian Financial Review

Victoria

Melbourne's residential property market is in the early stages of a new upward cycle, with a shortage of supply helping to push prices higher.

In contrast to some economic forecasters, industry experts on the ground in Melbourne are predicting steady capital growth and sharply rising rental yields for investors over the next 12 months.

They also expect the top end of the Melbourne market to continue to outperform the broader market because of a severe shortage of supply.

"We really have seen such a level market for a good three or four years now that what we're witnessing is a perfectly natural phenomenon, which is a growth spurt," Wakelin Property Advisory director Paul Nugent said.

"It's already taken place in capital value and we're starting to [see it] happen very quickly with rental values."

Melbourne's median house price rose by 4.2 per cent during the 12 months to the end of March to $359,500, while apartment prices gained 5.3 per cent to a median of $307,500 over the same period, according to the Real Estate Institute of Victoria.

The rental vacancy rate fell to 1.8 per cent in March, from 2.4 per cent 12 months earlier.

Rents for both three-bedroom houses and other two-bedroom dwellings rose by 4.5 per cent over 12 months to a median of $230 a week.

REIV chief executive Enzo Raimondo said the March quarter median prices had confirmed the market was in a steady growth phase.

Macquarie Real Estate has detected Melbourne is in the early stages of the next growth cycle.

Its 2006 market outlook, The World Squared, said an influx of overseas migrants was supporting underlying demand in Victoria.

Macquarie says Melbourne is ahead of Sydney and Brisbane in the cycle and is in a stabilisation phase, which is the precursor to the next strong upswing.

"Melbourne affordability wasn't really overstretched this cycle, meaning the downturn was not as severe as in Sydney," the report said.

"Melbourne moved into the stabilisation phase during the second half of 2005 and prices are now generally rising moderately, particularly in city fringe locations, although with some volatility."

Macquarie's modelling predicts flat to moderate prices over the next couple of years.

Macquarie has also forecast improving rental yields in investment apartments.

But BIS Shrapnel's director of building and construction, Robert Mellor, expected capital growth in Melbourne to be limited over the next few years as house prices were already fully valued.

BIS Shrapnel's recent report, Residential Property Prospects, 2006 to 2009, said underlying demand was weakening slightly and the market was fairly much in balance.

Mr Mellor said price growth would be limited to 8 per cent over the next three years.

But Mr Nugent was more optimistic. He predicted Melbourne house prices would grow by 5 to 10 per cent, rents by as much as 20 per cent, and that the time was ripe for investors to return to the market as vacancies tightened and rents rose.

"I think it could actually draw investors back into a marketplace that they've been largely steering clear of," Mr Nugent said.

"Unless we see a significant rise in interest rates, I think we're going to see that as yields strengthen, investors are once again going to see the merit in residential property, particularly those who are yield driven rather than capital growth driven."

But Mr Nugent warned that newer apartments, particularly in the CBD and some inner suburbs, were yet to prove themselves and would record poor capital growth compared with more established buildings.

Metropole Properties director Michael Yardney also believed the Melbourne market had moved out of its slump and was in the beginning of an upturn in the property cycle.

But he said it was owner-occupiers who had led the turnaround, although "smart investors" were starting to buy.

Mr Yardney said a looming rental crisis in Melbourne provided a very good opportunity to invest in apartments, although, like Mr Nugent, he was more in favour of established rather than new units.

"The majority [of investors] are still hearing things about uncertainty about interest rates, a number of economic forecasters are predicting prices are not going up for a while, so they're still spooked a bit," Mr Yardney said.

"So they're not going to buy until they see auction clearances are up, yields are up, vacancy rates are down and prices are up."

The managing director of agency network Hocking Stuart, Greg Hocking, said the market had gathered pace in the past six months.

He is forecasting median price growth of about 5 per cent across Melbourne.

Eureka!

July 2nd, 2006, 03:59 AM

hmmm, shoebox architecture.
reminds me more of Sirius in the Rocks,>
http://img154.imageshack.us/img154/9403/sirius5qh.jpg

im suprised a dump like that would still be there... prime location next to the bridge and opera house

CULWULLA

July 14th, 2006, 04:45 AM

^its owned by Department of Housing, thus the "dump" still remains.i dontmid it. blends in with nearby concrete aproachway. nice bold architecture. very rare box deisgn.
anyway
#article from todays fun rev!
sales seem to be going ok.sales of $37mil so far this year! 80% of units are now sold, but 4 penthouses remain with $7mil price tag.
i reckon since its completed, the iconis status will woo potential buyers.
http://img104.imageshack.us/img104/6059/eurekastorey2ow.jpg

Grollo

July 14th, 2006, 05:22 AM

Nonda and Karl have levels 82 and 83 :-)

skyisthelimit

July 16th, 2006, 11:16 AM

Nonda and Karl have levels 82 and 83 :-)

What's the highest penthouse level?

Edit, nvm just read the article, so 87?

Marky Mark

July 26th, 2006, 01:27 PM

Senior Cost Planner / QS
Major International developer
Huge Victorian retail project
Great salary package

Our client is one of the biggest developers in the world with a specialisation in retail and commercial projects. They have a very experienced professional team and deliver projects on a turnkey basis.

They are currently looking for a Senior Cost Planner to work on a $130 million retail development in Melbourne. Duties will include:

Design development with a focus on cost and cost optimisation
Value engineering
Executive cost reportingCandidates must have:

Excellent estimating and cost planning abilities
Excellent value management abilities
Design management and development expertise
Knowledge of real costs rather than just theoretical numbers
At least 10 years experience in a similar role for a builder or QS company
Relevant tertiary qualification
This type of opportunity only comes up once in a while. This role sits at the coal face of a massive landmark project in Melbourne. The client is looking fod a cost management expert with a good grasp on the market. :)

And this one LOL :cheers:

Senior Project Engineer
$70M+ project
Progression to Project Management
Excellent career move

We are currently seeking to recruit a Senior Project Engineer for a top tier commercial builder in the Melbourne construction industry.

To be considered for this outstanding opportunity you must be able to fulfill the following criteria:

5 years plus experience as a Project Engineer or Junior PM
Experienced with a solid VIC building contractor, preferably on major commercial projects
Experience with structure and high quality finishes
You will be responsible for reporting in to the Project Manager and ensuring that the project runs smoothly as regards budget and timeline ensuring that your team effectively manage all subcontract packages.

The successful candidate will take on a senior role on a newly awarded $70M+ project in the CBD and will ultimately be expected to progress into a Project Management position.

A relevant tertiary qualification within a construction discipline would be ideal though applicants with a trade background will be considered.

The successful applicant will be rewarded with a package in the $120k+ region depending on level of experience.

To submit your application, please apply online using the appropriate link below, or email your resume to

apply@designandbuild.com.au

Alternatively, to find out more about this opportunity, please call Neil for a confidential conversation on 03 9866 7500

Please visit our website for more information on us and all of our current vacancies.

Apply now

MG2

July 27th, 2006, 07:07 AM

What development are they talking about... does anyone know?

MG2

Grollo

July 27th, 2006, 07:52 AM

The homemaker centre next to the new convention centre?

Favco750

July 27th, 2006, 02:26 PM

$120k a year......

Is it only part time??????????????????????

Ha ha ha ha ha ha ha ha ha ha ha ha ha :) ;) just kidding

Tyson

July 27th, 2006, 03:12 PM

For the first job advertisment, I'll put my money on ING with their big wheel project and associated retail/commerical development at Docklands.

For the second one if anyone is really wanting to find out they could give Neil a call, hehe.

Grollo

July 28th, 2006, 05:49 PM

According to the Real Estate Institute of Victoria Median Melbourne Apartment prices have risen 5% over the past year, that's higher than the 4.2% increase for house prices and the second year in a row that apartment prices have risen faster than house prices.

So what happened to the doom and gloom predictions from a couple of years ago that buying an aprtment was financial suicide compared to buying a house which was a solid investment???

Londoner

July 28th, 2006, 08:45 PM

Median prices are not always reliable. The real question is how much the same apartment would have sold for last year and this. I may be wrong on this but my perception is that the market for the lower cost (CE etc) type units has probably slowed down much more than that for the higher priced mainly owner-occupier units. If this is so then the median would go up in a static market.

tayser

August 2nd, 2006, 06:04 PM

Flat shortage a welcome sign
Mark Phillips
3 August 2006
Australian Financial Review

A looming undersupply of new apartments in the Melbourne central business district is good news for investors, according to PRDnationwide.

The national real estate agency forecasts that the City of Melbourne residential market will be undersupplied by 2009.

Slowing growth in dwellings, population growth and falling vacancy rates point to the market having started to turn around, luring investors back, PRDnationwide's research suggests.

"We are starting to see the beginning of the new cycle," said Tim Storey, managing director of PRDnationwide's Melbourne corporate office.

"This has largely been driven by improving demand as astute investors pick up affordable properties left over from the last cycle and start to look for new opportunities," Mr Storey said.

"As rents improve, so will the depth of this investor market."

The last development cycle followed pent-up demand caused by rapid population growth.

The CBD's population grew by 36.4 per cent in 2000 to 6963, followed by a 28.6 per cent increase in the number of dwellings in 2001 to 5494.

Development peaked in 2002, when the number of dwellings in Southbank and Docklands grew by 39.6 per cent and 407.9 per cent respectively.

PRDnationwide has identified 2714 apartments at the planning or construction stage in the CBD, including 681 student apartments and 451 serviced apartments.

Across the City of Melbourne - which includes Docklands, Southbank, St Kilda Road and Queens Road - 5320 apartments are planned or under construction.

But dwelling growth will fall by 54.8 per cent this year and 62.1 per cent next year in the CBD, while 90 per cent of apartments in planning or construction are due for completion by 2008.

In common with other capital cities, Melbourne has been characterised in recent months by a tightening of rental vacancy rates as supply and demand become more closely aligned.

Vacancy rates in the CBD were 2.5 per cent in February, compared with 7.6 per cent in October 2002.

Rents in the City of Melbourne and the inner city rose 29.7 per cent and 14.9 per cent respectively between 1999 and 2005.

In March, average inner-city apartment rents were $390 a week, while across the City of Melbourne they were $361 a week.

As supply and demand moved closer together and rental returns increased, investors were poised to return to a market they had largely abandoned over the past three to four years, PRDnationwide said.

Mr Storey said the apartment market had been skewed towards owner-occupiers over the past couple of years, but a return to market fundamentals would create a more favourable environment for investors.

There would not be a development boom, but there should be a pick-up in development of well-located sites.

CULWULLA

August 3rd, 2006, 01:03 AM

yeah the lull is a happening now and will continue for a couple of years. 2009 sounds like the year markets pick up and some larger projects will start.So much has been added to melb in past 5 years, only now starting to realize impact.bring on next generation of resis.

Grollo

August 9th, 2006, 04:37 PM

The irrational fear of an apartment market bust and lack of new apartments being built has led to a severe shortage of apartments in inner city Melbourne despite the completion of so many massive projects like Eureka and FWP over the past year.

Melbourne has well and truly absorbed all of the apartments that have been completed over the past five years in the inner city and in fact the current figures show that not enough apartments have been built with the vacancy rate hitting a new low of 1% and apartment prices rising faster than house prices.

The REIV June 2006 Rental vacancy rates show that Melbourne rental vacancies remain at their lowest since March 1998.

REIV CEO Enzo Raimondo said that for the second month the Melbourne wide vacancy rate was a low 1.7 per cent and Regional
Victoria also remained steady with a vacancy rate of 2.4 per cent.

Mr Raimondo said “With a second rate rise this year I would expect the market to get even tighter as buyers of more affordable properties may defer property purchases and remain in rental accommodation.

While the overall vacancy rates remain steady there have been regional variations.

“Within 4 km of the CBD there also appears be a reduction in supply which may also cause a further tightening in the market. In March this year the vacancy rate within 4km was a low 2.3 per cent, now it’s only 1 per cent.

“Our measure of untenanted properties and vacant new properties provides further confirmation of the lack of supply. In March this year 3.1 per cent of properties were untenanted or newly created vacant properties. Now this rate is a low 1.7 per cent.

“This shows that there is very little new supply coming onto the market in places like Docklands, Richmond or Carlton.

“Rental vacancies in the inner city are in high demand, this is good for owners and investors and will make it harder for people looking for rental accommodation.

“There has been a small increase in the vacancy rate in the suburbs between 4 and 10 km from the CBD – suburbs such as Brunswick, Northcote, Newport, Essendon, Elwood and Elsternwick.

“Outside Melbourne there is a better availability of rental accommodation except in the Geelong region where the vacancy rate dropped from 2.4 per cent to 1.4 per cent in one month. It’s almost as hard to find rental accommodation in Geelong as it is in the inner city of Melbourne.

“While the low rate is not good news for renters I expect investors should receive better returns,” Mr Raimondo concluded.

Vacancy rate June 2006
MELBOURNE
Inner (0-4km)- 1%
Inner (4-10km)- 2%
Middle - 1.9%
Outer - 1.8%

As long as interest rates don't rise more than another quarter percent we are in for another boom.

Watch out for a 100 storey mixed use office/apartment building proposal on the Spencer Street Power Station site, it's only a matter of time :-)

tayser

August 9th, 2006, 05:05 PM

http://www.theage.com.au/news/national/tenants-suffer-as-rents-soar/2006/08/09/1154802962859.html

Tenants suffer as rents soar

Ben Schneiders
August 10, 2006

A TENANTS group says some renters are being hit with increases of more than 20 per cent as landlords take advantage of lower vacancy rates.

The latest data from the Real Estate Institute of Victoria shows that the vacancy rate in Melbourne in June is at an eight-year low of 1.7 per cent. A year ago it was 2.6 per cent.

Property developers and the Tenants Union of Victoria say that in some areas rents are rising steeply with an expectation that they will continue to rise.

REIV chief executive Enzo Raimondo warned that the rental market might tighten further due to rising interest rates, as some buyers might defer purchases and remain in rental accommodation.

Research and policy worker Rebecca Harrison, at the Tenants Union of Victoria, said tenants were saying rents were increasing by 10 to 25 per cent in some cases.

"The market is much tighter and people are having to put in a lot more applications," she said. "Another consequence of the lower vacancy rate in that a lot of landlords are taking the opportunity to increase the rent."

Ms Harrison said tenants were being forced to "cast the net wider" as they looked for rental properties.

According to the REIV data, the lowest vacancy rate in June was in inner-Melbourne where it was 1 per cent.

Vacancy rates were slightly higher in Melbourne's middle and outer suburbs at just below 2 per cent.

A well-balanced market is when the vacancy rate is just below or about 3 per cent.

Property developer and landlord, Greg Rips, of Viva Properties, said returns for investors were improving.

"Rents have been going through the roof," he said.

Mr Rips said he expected rents to increase 20 per cent in Frankston — the market he mostly operates in — and the inner city.

The chief executive of property manager Run Corporation, Nathan Cher, said some would-be-renters were offering to pay more than the advertised price.

Less stock on offer was helping to drive the market, he said.

Mr Raimondo said as rents rose investors might start to return to residential property in greater numbers.

ABS data released yesterday showed that loans to investors now represent about 32 per cent of all loans in Australia, the highest level since June last year.

Tyson

August 9th, 2006, 05:20 PM

As long as interest rates don't rise more than another quarter percent we are in for another boom.

Watch out for a 100 storey mixed use office/apartment building proposal on the Spencer Street Power Station site, it's only a matter of time :-)

How about a 100 floor resi and a 100 floor office right next door? ;) Both markets appear to be quite favourable to developers.

Alibaba

August 13th, 2006, 03:11 PM

One East Melbourne Apartment ad was on Sunday Age Life magz

anyone know the render of this...?
its ads looks rather exclusive

Aussie Steve

December 8th, 2006, 10:04 PM

Going up (http://www.theage.com.au/news/national/going-up/2006/12/08/1165081153197.html)

http://www.theage.com.au/ffximage/2006/12/08/going_up_wideweb__470x311,0.jpg
New perspective: Lend Lease's Dock 5 marketing director Nicki Smith takes in the view from the 22nd floor. Lend Lease is now following the "smaller is better" trend, building a nine-storey building at Victoria Harbour.
Photo: John Woudstra

9 December 2006

The mid-rise is on the up as the luxury flat market loses its head for heights, writes Ben Schneiders.

BIGGER may not always be better, it seems. In the fickle world of Melbourne's luxury apartment market, "boutique" and "exclusive" are the new buzz words. While million-dollar views may still be highly prized, sharing them with too many neighbours is not.

According to Melbourne's leading property developers, the rich no longer care to be stacked on top of one other like so many sardines in a can. Instead, they prefer blocks with fewer than 60 apartments.

And, scared off by sluggish sales in mega-towers such as Eureka and Freshwater Place at Southbank, which between them have more than 1000 apartments, developers are scaling back their ambitions.

Recent figures reveal 30 per cent of apartments at Freshwater Place remain unsold, and 15 per cent at Eureka, despite being on the market for several years.

Now "small is wonderful" is the mantra — at least when it comes to the number of residents.

Every developer will tell you that its particular boutique development has the best views, the highest ceilings, the most exotic design and the tightest security. Some of them are probably right. But the shift in emphasis is the tale of a maturing market, developers say.

"The high-end purchasers certainly want more exclusivity than some of those big buildings would offer," says Becton chairman Max Beck.

His company's One East Melbourne development will have fewer than 60 apartments.

"I've seen the market move since we did East Melbourne in 1991, where most of the people wanted an apartment building to look pretty much like their house," he says.

Now, about 80 per cent of those in the luxury market want contemporary design rather than a replica of their old family home, Mr Beck says.

Max Moar, of Lustig & Moar, which is co-developing the Lucient in St Kilda Road, agrees the market has changed.

"If you talk about 'exclusive' and the 'high end', you can't have 200 or 300 apartments. It has to be exclusive, so it has to be 30, 40, 50 or 60 apartments maximum," he says.

The change in emphasis has led to proposals for a number of boutique projects, particularly in St Kilda Road. Besides the Lucient, another developer with such plans is Morry Schwartz.

His 17-apartment development at 401 St Kilda Road has starting prices of nearly $3 million. "Beauty elevates life," he says of his vision.

But not everyone is convinced by the new trend. South Yarra-based buyers' advocate David Morrell says there is better value in established housing.

"It's not rocket science … if you are buying off a developer, there's no way known you're not giving him 25 per cent profit, which is above the market."

Luxury apartments are a "lifestyle call" rather than an investment, he says.

Others say the market demand is real, fuelled by changing demographics and growing wealth, helped by 15 years of economic expansion.

"I think people who are getting on … will move into apartments, where they can get the same luxury and comfort," Mr Moar says.

Maurice Cococcia, Lend Lease's project director at Victoria Harbour in Docklands, also believes the apartment market is growing up. Along with its luxury 31-storey Dock 5, the developer is building a nine-storey building. It will have six terrace houses and just 63 apartments.

"Not everyone wants to live in a 50-storey building… There are definitely different needs for different people that will spawn different product types," he says.

"It is a market that is maturing, and people are beginning to understand what it means to be living in an apartment building."

_______________________________________________________

Going down (http://www.theage.com.au/news/national/going-down/2006/12/08/1165081153200.html)

By Clay Lucas
9 December 2006

IN COOBER Pedy, living underground is de rigueur. But in North Carlton?

Storage consultant Alan Contini was desperate for more space for his two teenage girls and his wife's home office. And so the family decided that a move downwards was the only option.

The family's North Carlton home, built in 1910, is in a heritage area opposite the Melbourne General Cemetery.

It could not be extended upwards because of council laws on heritage and overlooking neighbouring properties.

And it could not go outwards because it sits on a small block. There was only one direction left to go.

"Down: that's where a lot of people don't even think about going," Mr Contini said when The Age first spoke to him about the project.

Then, Mr Contini stood ankle-deep in mud as workmen dug 1000 tonnes of solid clay and mud from under the house, to create a room with three-metre ceilings.

The mud and clay was trucked to swampland under the West Gate Bridge, which the local council is trying to build up with clean soil.

This week, standing amid the new living room and home office that now sprawls under virtually the entire 140-square-metre block, Mr Contini said going down was the obvious option for inner-city houses where heritage laws restricted going up.

"Once people see what we've done, they think it's the obvious thing," says Mr Contini, who is helping two other inner-city families get underground renovations started.

The renovation has cost more than $400,000, and increased the house's size from 22 squares to 38 squares.

It has also taken the house's value from $850,000 to about $1.3 million, says real estate agent GA Thomson.

Mr Contini got the basement idea from a trip to Europe.

"We'd been in Paris and London, and a friend there had just had it done to his house," he says. "They have the same problems in the inner city as us: finite space, heritage issues and expensive land."

A survey of councils in inner Melbourne this week found no other examples of renovators going down instead of up or out.

But basement extensions are something we could see more of, one Melbourne architect says.

"Building down costs a lot more than going up," said Ashton Raggatt McDougall architect Jesse Judd, who won a Housing Industry of Australia award last year for innovative housing design.

"And getting enough light in is another big issue.

"But I think we might find it's more and more a scenario we see, because inner-city councils are so worried about their streetscapes."

Simple economics dictates that land prices will have to increase substantially before excavating basements for living areas takes off in Melbourne.

But there are already definite benefits, experts say.

"From a heritage point of view, it's great. It's not doing what Melburnians love: rip down everything except the facade," said RMIT planning professor Michael Buxton.

Yarra Mayor Jackie Fristacky said there were about 10 applications a year for basements in her area. "But they're usually cellars and storage areas."

The main concern with digging down was soil stability, drainage and the potential impact on your neighbour's house, she said.

BENEFITS OF GOING UNDER

¦Temperatures more stable, reducing heating and cooling costs.

¦Completely sound, reducing noise from neighbours.

¦Maximises site usage, reducing the need for large blocks, a key tenet of the State Government's Melbourne 2030 policy.

¦Increases property value.

http://www.theage.com.au/media/2006/12/08/1165081156565.html

tayser

December 12th, 2006, 11:26 AM

It's full house as rents climb
Robert Harley
12 December 2006
Australian Financial Review.

VACANCY RATES
Perth 2.1pc
Hobart 2.0pc
Darwin 1.7pc
Sydney 1.7pc
Brisbane 1.7pc
Melbourne 1.6pc
Adelaide 1.5pc
Canberra 1.1pc
Source: Real Estate Institute of Australia

The shortage of rental accommodation across Australia has reached levels not seen since the early 1980s, foreshadowing more pain for tenants but increased returns for the 1.5 million investors who own a rental property.

In the September quarter, vacancy rates in the Australian capitals ranged from 1.1 per cent in Canberra to 2.1 per cent in Perth.

"It's a full house," trumpeted the headline on Real Estate Market Facts, the quarterly update prepared by Mortgage Choice and the Real Estate Institute of Australia.

"It is incredibly tight," said Tenants Union of Victoria policy officer David Imber.

"Despite all the focus on home buyers, the people who are doing it hardest are the low- and middle-income private renters."

Not since the early 1980s has rental accommodation been so tight in so many cities.

REIA president Graham Joyce said successive interest rate rises had put considerable pressure on rental markets, with vacancy rates declining across the country and rents outpacing the CPI.

"While this is a difficult environment for renters, investors are encouraged by improving returns on their investments."

Mr Joyce warned that any change to negative gearing would worsen the crisis.

With vacancy rates in every city below the 3 per cent figure necessary to ensure a reasonable supply of accommodation, rents are already on the rise.

In the year to September, the increase ranged from a manageable 3.8 per cent for three-bedroom houses in Sydney to a crippling 20 per cent for two-bedroom units in Perth.

BIS Shrapnel analyst Angie Zigomanis said strong demand was pushing up rentals in a market where supply was constrained by lack of affordability, underbuilding and weakness in investor activity.

Mr Zigomanis said the position was most acute in Sydney and he predicted rents in the city would rise by up to 40 per cent by 2010.

For Brisbane and Melbourne, he predicted rental rises of about 20 to 25 per cent and something less for Perth as the booming city has already experienced strong rental growth.

Only last week the Australia and New Zealand Banking Group's economics team warned that rental vacancy rates were well below trend and likely to go "significantly" lower in the coming year as new construction slipped further below underlying demand.

"A critical shortage of rental accommodation will take several years to turn around, placing significant upward pressure on dwelling rents," wrote senior economist Ange Montalti.

Mr Imber said rents could only rise so far before they became unaffordable and tenants made alternative arrangements, such as moving back home.

"I think we have seen a bit of a limit to opportunistic rent rises in Melbourne," he said.

"The problem highlights the lack of a national housing policy."

tayser

December 16th, 2006, 06:02 AM

Capital Gain is reporting 'Grater off the shelf' - PDG & Schiavello are breathing life into the project again.

http://www.theage.com.au/ffximage/2004/05/26/grater_2705.jpg
(Fitzroy)

Schiavello are a busy lot for a group who haven't built anything big yet (but certainly have big plans).

mugley

December 16th, 2006, 06:29 PM

Ugly piece of crap, architecturally and socially incompatible with the Fitzroy of today. It's amazing that people want to get rid of the Atherton Gardens towers, but will tolerate a new generation of the same (albeit more curvy) shit going up. :ohno:

Hope it gets squashed before it becomes another "The Max"-style yuppie prison.

Muse

December 18th, 2006, 08:06 AM

Who siad Melbourne is in a lull?

From last Thursday's Fin Rev (14/12/06):

http://img.photobucket.com/albums/v190/Muse11/FinRevA14Dec2006.jpg

tayser

January 19th, 2007, 12:24 PM

Lots and lots: Melbourne housing outlook positive
Mark Phillips
19 January 2007
Australian Financial Review

New figures showing a revival in residential subdivision plans have been seized upon by the Victorian government as evidence that its controversial Melbourne 2030 planning strategy is on track.

The number of residential lots in subdivision plans submitted to councils rose by 18.8 per cent in the September quarter, suggesting a strengthening market for new housing at the beginning of 2007.

A total of 8679 residential lots were submitted to councils in subdivision plans in the September quarter, the best quarter since December 2003, according to the Residential Land Bulletin compiled by the Department of Sustainability and Environment.

In total, 29,747 lots have been recorded in subdivision plans in the past 12 months.

The submission of subdivision plans is an indicator of developers' outlook for the market and the pipeline of lots to come.

Dwelling approvals also increased Melbourne-wide in the September quarter by 25 per cent to 7137, the best result since June last year.

However, the number of lots released - that is, lots that have been issued with a council certificate of compliance after roadworks, drainage, water supply and other requirements have been met - fell significantly by 44.5 per cent to 4486.

The state's new Planning Minister, Justin Madden, said the figures were a sign of a positive outlook for new housing and pointed towards increasing activity. They showed that the principles of Melbourne 2030 of providing a choice of housing in established or new suburbs were working and the market was responding to that diversity.

The chief executive of the Victorian division of the Urban Development Institute of Australia, Tony De Domenico, agreed there was industry-wide confidence, but said local government delays in making decisions were hindering residential development.

"There's definitely a demand there because Melbourne land prices are still very competitive in terms of what you can find elsewhere in the country, Victoria is attracting a lot of migrants and the economy is doing well," he said.

There were 7759 lot sales in Melbourne's growth areas in the 12 months to the end of September.

_________

last few paragraphs are particularly encouraging.

vytux

January 19th, 2007, 12:36 PM

Schiavello are a busy lot for a group who haven't built anything big yet

They're full of hot air, and have a lot to prove

tayser

February 2nd, 2007, 02:11 PM

http://www.theage.com.au/news/business/investors-flocking-back-to-property/2007/02/02/1169919533558.html?page=fullpage#contentSwap1

Investors flocking back to property
Mark Armstrong and David Johnston
February 3, 2007

http://www.theage.com.au/ffximage/2007/02/02/knAPARTMENT_narrowweb__300x357,0.jpg

Return of the rental.
Photo: Tamara Voninski

DWINDLING affordability looks set to force more first home buyers out of the property market in 2007, paving the way for an investor-led recovery.

Rental vacancy rates continue to plummet, with September-quarter figures from the Real Estate Institute of Victoria showing a rate of just 1.6 per cent — the lowest since March 1998.

The tighter the rental market, the more scope investors have to raise rents. This is particularly beneficial for investors who bought during the upside of the previous property cycle in 2001-03 when capital growth was strong and rental returns were 3 to 4 per cent.

They have now held their properties long enough to experience the second phase of the cycle, when capital growth has slowed but rental returns are firming around 4 to 5 per cent.

With improved cash flow, they are in a solid position to buy again and take advantage of the next full growth cycle. This cycle began in the second half of 2006 and will start to accelerate in 2007.

A change of trends in rents and interest rates will also influence this investor-led recovery. In 2006, rents rose and interest rates did too, so there was no impetus for investors to re-enter the market.

In 2007, rents will continue to rise because of the growing first-home-buyer affordability crunch. However, it's probable that interest rates will stabilise or, ideally, fall.

With eight rate rises since 2002, national building starts — a key housing market indicator — are still subdued. Although the Bureau of Statistics recorded a 2.5 per cent increase from the June to September quarters of 2006, the overall increase for the year to September 2006 was only 1.1 per cent.

The Reserve Bank must take decisive action to reduce interest rates if there is to be a sustained improvement in these figures.

In turn, lower interest rates will further improve cash flow, luring more investors back into the property market.

Meanwhile, the big guns are already shoring up their exposure to the residential market — perhaps the clearest sign that an investor-led recovery is on the way.

As advisers, we saw an increasing number of experienced individual investors in the second half of 2006 who were capping their exposure to shares in the wake of the sharemarket's three-year bull run. While not necessarily anticipating a sharp sharemarket decline, they believed the time had come to spread their risk and cream off some of their profits to diversify into residential property.

Furthermore, developers of multi-unit complexes who traditionally target investors are on the prowl again, after several years of subdued activity while they wait for the market to soak up supply.

The latest State of the Market report from property analyst Charter Keck Cramer identifies 1330 new releases in the inner city during 2006, compared with just 375 in 2005.

Research director Robert Papaleo believes there will be a similar number in 2007, and an increased focus on areas beyond the inner city such as Carlton, Ascot Vale and St Kilda.

"Developers know that the established market has bottomed out and rental returns are rising, so they're beginning to come on line," he says.

"2007 won't bring a construction 'boom' as such; it will be more like a steady stream because rental returns haven't yet firmed to a level that justifies substantial activity. However, the number of new releases during 2006 shows that developers are adopting a more positive outlook on the market."

When the big boys start making a move, it's a pretty sure sign they believe that the bulk of investors will soon return to the market.

Individual investors would be well advised to take a leaf out of their book.

When it comes to property investment, there's no such thing as safety in numbers. If you wait until other investors have re-entered the market en masse, you'll have to compete for the best calibre properties, and doubtless pay more for the privilege.

However, if you're active in the market while there is still relatively little competition from other investors, you'll have the pick of the properties and the best chance of enjoying the full cycle of capital growth when it begins to take off in 2007 and into 2008.

Mark Armstrong and David Johnston are directors of Property Planning Australia, which advises on mortgage finance. www.propertyplanning.com.au

tayser

February 6th, 2007, 09:19 PM

http://www.theage.com.au/news/business/housing-recovery-kicks-in/2007/02/06/1170524094763.html

Housing recovery kicks in
Tim Colebatch, Canberra
February 7, 2007

VICTORIA'S housing industry is about to begin a recovery at last, with construction activity bottoming out and set to rise through 2007, although not yet in the apartment sector, the Housing Industry Association forecasts.

But the HIA's latest quarterly outlook sees a national recovery still some months away, with a further slump in NSW pushing down housing starts, despite a growing rental shortage.

As the Reserve Bank board met in Sydney yesterday, this time with no recommendation before it to raise interest rates, the association predicted only a slow and gradual recovery across the nation, implying that the shortage of accommodation would get worse.

At national level, HIA chief economist Harley Dale said the crisis in housing affordability would reduce housing starts marginally in 2006-07 to 149,600 — about 12,500 fewer than its estimate of underlying demand.

"New building activity will be softer this year, but a recovery should slowly emerge over 2007-08," Mr Dale said. "A stable interest rate environment in 2007 will create the platform for a gradual improvement in housing conditions as we move through the year."

Victoria, however, would jump the gun slightly. Mr Dale estimated that the state's commencements will inch up to 39,300 in 2006-07, and then climb steadily to 45,400 by 2008-09 — well above underlying demand.

Renovation activity, which tends to be more stable, will bottom out this financial year and average real growth of 5 per cent over the next two years.

"Melbourne benefits from having a bigger supply of land coming through than Sydney or Perth," Mr Dale said. "It would be recovering already were it not for the interest rate rises, but that will be a 2007 story."

While the glut of unsold apartments in inner Melbourne has dissipated faster than anyone expected, he warned that there would be quite a time lag before a new wave of apartment construction got under way.

"The supply overhang was never as bad as people thought, and it seems to be commonly accepted that it's pretty well gone," he said. "But we're caught between cycles.

"People will now be looking at sites, doing the numbers, and we'll see a new wave of projects getting under way in 2007-08."

But the HIA predicts that while the number of new houses commenced in 2008-09 will almost match its peak in 2003-04, unit development activity will not return to boom levels in the next three years.

This implies an increasing shortage of properties in inner areas, where the most intense demand is.

The figures also show that each state is a different market. The HIA estimates that housing starts in NSW this year will be a massive 24 per cent below its level of underlying demand. Starts in Queensland would be just 8 per cent below underlying demand and Victoria 5 per cent below but Western Australia would be 5 per cent above.

Muse

February 17th, 2007, 03:37 AM

From the Fin Rev, Thurs 15/02/07...

Hoteliers take aim at apartment deals

Robert Harley

Investors leasing residential apartments to tourists on short stays are under attack, both from permanent residents of apartment blocks and now the hotel industry.

The Australian Hotel Association has set up a "dob-in line" (for apartment dwellers irritated by short-stay tenants in their building, and in just a week's operation it has received more than 200 calls.''

The callers complain about noisy parties in their corridors, about car parks full of rental cars and garbage clogging up their rubbish chutes.

The hotel lobby is complaining that they are locked in an unfair battle for the tourist dollar against a competitor unencumbered the the every day red tape of running or setting up a hotel.

But investors, many of whom bought apartments in the heat of the most recent building boom, believe it is their right to offer property to gain the best return and feed a demand in the marketplace.

AHA National Affairs Director Bill Healey said the planning rules which had once seperated residential homes from commercial hotels were now redundant.

"This is an issue right across the country." he said.

"What we are asking is for people in residential accommodation, if they think their flats in their facilities are being used in a non-residential way, to call in."

Mr Healy said short-term operators benefited from cheaper establishment costs, a lower compliance burden on issues such as fire and disabled access and non-commercial rates for electricity and water.

"It really distorts the market." he said.

He claimed the lower rates being offered by short-stay apartments were one of the factors holding back the development of new hotels.

He said the unregulated short-stay market could damage Australia's brand as a destination, particularly in high-yielding growth markets as India and China.

But at least one hotelier has broken ranks. Accor Group, a member of the AHA, has lent its Mecure brand to a short-stay operation using apartments scattered through residential towers at Melbourne's Docklands.

Accor's Michael Issenberg said the move was a once-off opportunity but refused to rule out buying and badging more short-stay apartments.

He said the groups professionalism would manage the possible downsides of the practice.

A City of Sydney spokesperson said nine apartment complexes were under investigation , covering about 100 apartments, for operating short-term accommodation in breach of planning permits.

Manly City Council, which is home to some 750 short-stay units, spent a year looking at the issue. Mayor Peter Macdonald sad it had concluded that amenity issues could be addressed through a complaints mechanism.

Following a warning, the council can issue an order requiring owners to cease offering their apartment for short-term accommodation or risk being fined.

After 18 months of operation, Dr Macdonald said a number of units had been taken off the market; none had yet been fined.

Michael Hynes, General Manager of Docklands and major projects at VicUrban, which manages he precinct, said there were no restrictions on using residential apartments for short stays.

Ace Body Corporate Management manages 16,000 units across 1500 buildings around Australia, and Chief Executive Stephen Raff said short-term accommodation was a growing concern.

"It's a real problem. You generally find the issue is parking - because quite often they don't know the body corporate standard rules nor the additional rules." he said.

There might be additional rules, like saying hanging clothing over the balcony was not allowed, he said.

"A lot of residents living in these body corporates get up in arms about it but under the legislation there is not too much they can do".

Dingle Partners Managing Director Malcolm Dingle runs about 150 short-stay apartments in Melbourne.

He said short-term letting boosted yields form about 3% up to as much as 6% compared to long-term renting, and enforced change would hurt investors.

Furnished Property Industry Association Justin Butterworth said self-regulation was the answer, and the finishing touches were being put on a code of conduct.

He accused the hotel industry of anti-competitive behaviour, and said consumers were voting with their feet.

"You are also talking about property investors who for various reasons want investment choice.

A seven-day rental is no more a commercial use than a seven-month rental.

It is a completely different market. What has happened is there has been a gap in the market and the internet and property booms have allowed consumers to say, 'We want something that does not include services we don't require and is more affordable over a three- or four-week stay" he said.

"The hotel lobby has seen this burgeoning industry, driven both by investors and visitors, and is trying to shut down the competition".

Londoner

February 17th, 2007, 02:22 PM

When visiting Melbourne I now always stay in short stay apartment in City Point (where I also own a unit that is rented out). I don't blame the hotel lobby for fighting their corner but renting a unit gives me just what I want: space to invite friends back, freedom to do my own thing with no daily cleaner (I can make a bed - just!), washing machine and drier, kitchen (even though I never make more than drinks), cheap phone calls and use of swimming pool. In short, everything I want and I'm not paying for things I don't want, like 24-hour room service. It's home from home, not something one ever says of a hotel room, especially at this price bracket.

Standards: the entrance foyer at City Point puts any budget hotel to shame. Fire safety: 500 people in a tower, is 500 people, whether they are there for days for years. From the minutes of the annual residents' meeting there have perhaps been some issues with short term visitors not behaving appropriately, which have been addressed but that is a matter for the building managers, not an outside body.

Money: a short stay apartment on 100% occupancy (not achieved in practice of course) is grossing the operator something like 3 x the rent they're paying the owner. The owner benefits from a long term rent flow with their unit probably being used less intensively than by a long term tenant (tourists tend to spend most of their time out) and the operator is employing admin staff, cleaners and others. Just like hotels do .....

Muse

February 17th, 2007, 02:48 PM

I believe that Meriton here in Sydney, rents out short-stayers on whole different floors in certain towers to those of permanent residents, but this is directly company run and not individually yet going thru a middle-man agency managed, like a lot of the Melbourne cases seem to be (re the article I posted on the previous page). So it's like serviced apartments but not in the whole building, just on certain floors.

By seperating the 2 on different floors, this of course relieves certain issues for permanent residents eg. cutting back noise levels for those short-stayers that may want to "party all night" while on holiday.

A r c h i

March 24th, 2007, 05:23 AM

Apart from 380 Little Lonsdale are Brady planning other buildings? I noticed this in today's Age, anyone know what building it is?

http://img260.imageshack.us/img260/224/bradytoweray6.jpg (http://imageshack.us)

Compared to other Brady projects it doesn't look too bad.

tayser

March 25th, 2007, 06:10 AM

http://www.theage.com.au/news/business/tide-turning-as-property-wave-prepares-to-break/2007/03/23/1174597889124.html?page=fullpage#contentSwap1

Tide turning as property wave prepares to break

Mark Armstrong and David Johnston
March 24, 2007

IF YOU'RE one of the many Melbourne investors disappointed in the performance of your residential portfolio over the past few years, you can hardly be blamed for wondering when your luck will turn for the better.

According to figures from the Real Estate Institute of Victoria, the local market grew by an average of just 2.9 per cent a year between 2003 and 2006 — not exactly something to shout about.

However, a deeper analysis of the institute's figures reveals a more accurate and positive scenario.

From 1980 to 2000, the Melbourne residential property market rose by an average of 9.4 per cent per annum. To test this over a more useful time frame (10 years, which is usually the maximum length of a property cycle) we looked at several 10-year periods between 1980 and 2006. No matter which time frame, the average annual growth was always 7 to 10 per cent.

Even in the period 1985 to 1995, during which the nation's economy took a battering in the "recession

we had to have", the average growth for Melbourne residential property was still 7 per cent per year.

In the decade from 1996 to 2006, the market's average annual increase was 8.7 per cent. As previously mentioned, the increase was just 2.9 per cent per year for four of those years (2003 to 2006). During the latter period, the average compound increase underperformed the 10-year average by more than half.

If the residential property market is to remain true to its historical performance and retain its 7 to 10 per cent annual increase for the 10 years from 2003 to 2013 — and we don't see any reason why it wouldn't — compound growth over the next six years must beat the 10-year average by 4 to 7 per cent per year. This means total growth of 11 to 17 per cent per annum.

Can the market deliver? We believe it can.

The residential market is a bit like a rubber band — the longer and more firmly you hold the band back, the further and faster it will move forward when you release the restraint.

In historical terms, four years is a relatively long lay-off time for Melbourne's residential market. We are now seeing signs the market has been held down as far as it can go, and is beginning to rebound.

Melbourne's inner suburbs, where auctions predominate, are a good barometer of market trends. Auctions depend on competition, so the higher the clearance rate, the greater the level of competition.

During February, auction clearance rates were more than 80 per cent; substantially higher than the 60 to 65 per cent in the same month last year.

If this trend continues, it is only a matter of time before the increased competition fuels price rises.

Who is driving this activity? We believe it is two distinct groups — baby boomers downsizing from large family homes, and generation Y DINKS (double income/no kids) focusing on establishing careers and sowing the seeds of financial security before they start their families.

The intriguing thing about the increased competition is that, on the demand side, the Melbourne market is still only flying at half-mast. While second and subsequent home buyers such as the boomers and gen Y are very active, investors are yet to come back into the fray on a large scale.

Once these investors begin to move — most likely in the second half of 2007 and into 2008 — the market will return to full strength and the level of competition will move up another gear.

In this scenario, it's quite feasible that our predictions of 11 to 17 per cent average annual growth will come to pass; generating long-anticipated equity for investors and complementing other asset classes in their portfolio.
Mark Armstrong and David Johnston are directors of Property Planning Australia, which advises on property and finance strategies.

www.propertyplanning.com.au

wowsim

April 3rd, 2007, 05:12 AM

Building approvals spike in Melbourne
Maurice Dunlevy
MATP
530 words
3 April 2007
The Australian
1 - All-round Country
22
English
Copyright 2007 News Ltd. All Rights Reserved

Indicators

MELBOURNE'S once troubled inner-city high-rise apartment sector has led an unexpected spike in nationwide February building approvals.

In February 2005, only 535 apartments were approved for Melbourne, but this year the monthly figure almost doubled to 1079, according to the Australian Bureau of Statistics figures out yesterday.

It's a remarkable turnaround for the previously oversupplied market, which at the back end of 2005 consistently recorded monthly approval numbers between 500 and 600, and in January this year sunk to only 350.

Paul Hameister, from apartment developer Hamton, said market confidence had returned, even though he remained uncertain about "mass market stuff".

Mr Hameister said demand for boutique product in inner and middle-ring established areas had given Hamton confidence for a development pipeline of around 500 new apartments and 250 townhouses over the next three to five years.

With rental vacancies down to 1.5 per cent, instead of the usual 3-4 per cent, stable interest rates and the stock market at the top of its cycle, he said investors now had an insatiable appetite for the right apartment product.

Seasonally adjusted, total February dwelling approvals across Australia rose 10.6 per cent and were up 10 per cent over the full year.

But it was "other residential buildings" -- industry speak for apartments and townhouses -- that drove the surge, jumping 31.5 per cent in a February that also recorded a 1.4 per cent drop in approvals for stand-alone houses. While the spike in apartment approvals masked a six-year low in the approval for stand-alone houses, Melbourne's resurgent apartment market was responsible for a 29.1 per cent February rise for Victoria.

South Australia was also strong with a monthly rise of more than 34 per cent and Queensland solid with a 7.5 per cent increase.

That was in contrast to NSW, which was basically flat, and Western Australia, which fell 10 per cent and is now 33 per cent down from its July 2006, peak.

But the headline figure was Melbourne apartments, supporting what until now has been anecdotal evidence that the sector was on the road to recovery.

Inner Melbourne had been so oversupplied that previous major apartment players including Mirvac and Australand put all projects on hold. Even Central Equity, the city's largest apartment builder, was forced to beat a hasty retreat during 2005.

But according to Devine Limited's Terry Hogan, there has been a noticeable change since before Christmas, with the publicly listed group now expecting to sell remaining apartments at its high-profile Docklands Victoria Point tower within the next three to four months.

The 449 apartments in Melbourne's largest single apartment tower, were completed at the height of the downturn in February last year.

Victoria Point straddles the Telstra Dome stadium and apartments in the development have sold for between $360,000 and $2.65 million.

Mr Hogan said the return to the market by investors, lured back by one of the tightest rental markets on record, had made apartments easier to sell.

tayser

May 27th, 2007, 01:10 AM

http://www.theage.com.au/news/business/city-rent-squeeze-continues/2007/05/26/1179601737395.html

City rent squeeze continues
May 27, 2007

MELBOURNE'S tenants have been warned that rents could rise as the city's vacancy rates hit a 25-year low.

Figures released yesterday by the Real Estate Institute of Victoria show rental vacancy rates are about 1.2 per cent and have not risen above 1.7 per cent for the past year.

REIV chief executive Enzo Raimondo said: "The last time we saw 12 consecutive months with a vacancy rate around 1.5 per cent was 1981, '82 and '83 when the vacancy rate ranged between 1 and 1.3 per cent."

He said the squeeze was being felt throughout the city, where most renters lived.

Vacancy rates were as low as 1 per cent in the inner city.

A market is regarded as being well balanced between supply and demand when the vacancy rate is about 3 per cent, a level last seen in Melbourne in early 2005. Since then much of the oversupply from the apartment development boom has been absorbed.

The situation is not as dire in middle ring suburbs, such as Burwood, where the vacancy rate is 1.4 per cent. But it has dropped to 1.2 per cent in the outer suburbs.

"We urgently need to find ways to encourage more investment in the housing market," Mr Raimondo said.

"If this tight market continues the upward pressure on rents will be very strong."

Data from the Australian Bureau of Statistics shows rental growth of 2.7 per cent in Melbourne last year, about the same pace as inflation, but well above the 1.2 per cent growth in 2005.

AAP

Marky Mark

June 3rd, 2007, 01:18 PM

Monday May 28, 2007

Malaysian investors keen on NZ and Australia

ASK any savvy Malaysian property investor and there is a high probability that he or she has property Down Under or in New Zealand.

This does not come as a surprise to Global Link Properties chief administrative officer (overseas properties) Norman Sia, who is a strong believer of the properties' investment potential.

Norman Sia does not believe Malaysians buying properties overseas will have any effect on the local market at all
“Malaysians are very interested in investing overseas, especially in developed countries which are politically stable and have transparent policies. They do it to preserve their wealth and to diversify their investments.

“Australia and New Zealand properties are more affordable compared with Singapore, Britain and Hong Kong,” Sia said.

In addition, property prices in Australia historically doubled every 10 years due to increasing costs such as land, labour and building materials, Sia pointed out.

He said Global Link Properties had introduced not less than 500 projects to Malaysian buyers comprising three types of properties – pure residential properties, student accommodation near learning institutions and condominium hotels, which are condos by usage but leased to hotels.

“Student accommodation and condo hotel cater to investors who buy for investment return so the properties sell faster.

“The least popular, in a sense, are residential properties, as prospective buyers find it hard to make a decision so it takes longer to sell the properties,” he said.

According to Sia, investments in hotel units provide the highest returns – a minimum of 6% net per annum – especially since Global Link focuses mainly on 4 to 5-star hotels.

“This is sustainable as such returns are achievable on a 30% occupancy rate. Student accommodation also offers good returns at 4.5% net annually,” he said.

About 80% of Global Link's clientele are people who run their own businesses as well as professionals who buy properties mainly for investment.

The balance are high net worth buyers who are not so concerned about returns but are looking for unique assets to add to their lists of properties.

“We had 200 to 300 investors last year and expect a 10% to 15% growth every year. We now have close to 200 investors this year. Sales have been boosted by a new project in Queenstown, New Zealand,” Sia said.

The Kawarau Falls Station project in Queenstown consists of 1,000 hotel apartments with a gross development value of NZ$1bil.

The project, launched in the beginning of the year, is 90% sold. It will start construction next month and is expected to be completed in 2011. Prices range from NZ$360,000 to NZ$1.5mil per unit.

Sia said about 60% of Global Link's sales were from Australian properties and 40% from New Zealand.

He said the company had put more emphasis on properties in New Zealand in the past two years as the products there were more unique. The Lord of the Rings movies have also made the country more attractive to property investors.

“We will be looking back at Australia in the next one year as property prices there have come down and stabilised. It will be a good time to pick up properties there,” he said.

The company will launch some new Australian and New Zealand projects here: two beachfront apartment projects in Gold Coast, Australia – one in two weeks and another in a month's time – and three projects in Melbourne – two apartment projects and students' accommodation. :)
He does not believe Malaysians buying properties overseas will have any effect on the local market at all.

“Those who invest overseas have their basket full of local properties already. Moreover, overseas investors are only a small group,” he said.

Sia himself has property investments overseas. About 85% of his property portfolio is in hotel units in Australia, New Zealand, Singapore, Hong Kong and Malaysia.

“It is important to look at income-producing properties. Brick and mortar is still the best investment where our wealth can grow with rental income thrown in as well,” he added.

Muse

August 11th, 2007, 10:12 AM

From this weekend's AFR, 11-12 August 2007

Melbourne CBD flats hit heights

Mark Phillips

http://img.photobucket.com/albums/v190/Muse11/MelbAptTowers.jpg

Melbourne's inner-city apartment market has overcome its "indigestion", as developers have experienced their best six months of sales since 2002.

Developers sold 1037 new apartments in the CBD and its key residential fringes of Southbank, Docklands and St Kilda Road in the six months to June 2007, following 925 sales in the second half of last year, according to property analysts Charter Keck Cramer.

That was the most sales activity since the second half of 2002, when 1158 apartments were sold.

Similarly, the 2006-07 financial year result of 1962 apartment sales was the best since 2002-03 and 25 per cent above the long-term annual average going back to 1994.

But not all sales activity was for new apartments, with a large portion being made up of overhanging stock from the last boom, which ended in 2003.

This overhang - which was 1907 apartments at the end of June - is expected to partly dampen the supply of new apartments in the short-term, despite the strengthened investor and owner-occupier demand.

The overhang of stock peaked at 2682 apartments at the end of 2004, and this was last this low in 2002.

Charter Keck Cramer's director of research, Robert Papaleo, said a sense of urgency was growing in demand for new apartments, particularly from investors, and confidence was returning from developers.

"I think we're going to see a lot more activity in the next few months coming through to Spring," he said.

"There's going to be a lot more stock off the plan, and it will be a real test of the market's strength.

A lot of property which has been dormant or shelved will start to see the light of day."

There were 1250 apartments released to the market in the first half of the year, resulting in negative net absorption of 210 apartments as new releases outweighed sales.

Mr Papaleo said this reflected a strengthening of investor confidence rather than a weakening demand.

He said the market was still dealing with the "indigestion" caused by an oversupply of apartments from the boom years.

Forty-two per cent of the overhang was in completed apartment projects, but developers are clearing their unsold stock from the past couple of years, with 37 per cent of sales in the first half of this year of apartments in completed projects. Forty-three per cent of sales related to projects that were released three or more years earlier. Southbank had the largest overhang of 760 apartments, most of that from projects under construction or in marketing, including two new towers from Central Equity.

Major projects released in the first half included Barton Tower (284 apartments) and East End (179) in the CBD grid. SouthbankOne (300) and Triptych (168) in Southbank, and 505 (290) in St Kilda Road.

Investors are being drawn back into the market by improving yields: after hovering between $280 and $300 a week for a one-bedroom apartment in 2006, rents in the central city have broken out to more than $310.

Grollo

October 3rd, 2007, 12:51 AM

REIV vacancy rate report
25-Sep-2007

The REIV’s rental vacancy rate report for August shows a significant tightening of the inner city rental market, particularly those suburbs within 4km of the CBD with the vacancy rate contracting from 1.8 per cent in June to 0.8 in August.

This means that in suburbs such as Southbank, Docklands, Carlton, Fitzroy and South Yarra there are practically no properties available for rent.

In the ring of suburbs between 4 and 10 km from the CBD the vacancy rate has eased over the same period, from 0.7 per cent in June to 1.7 in August.

As a result vacancies are slightly easier to find in suburbs such as Moonee Ponds, Coburg, Preston, Thornbury, Kew, Caulfield and Elwood.

It has now been 12 months since the vacancy rate in the inner city was above 1.8 per cent and is heading towards two years below two per cent. Three per cent is considered to be a market in balance.

There has been little change in the situation in the middle and outer suburbs where the vacancy rate is 1.4 and 1.6 per cent respectively.

Housing issues have rightfully received a lot of attention lately but that has centred on affordability. In many respects the persistently low vacancy rate is equally concerning.

The developers in docklands need to get their fingers out of there arses and start releasing more towers. There is a limited supply of land in the inner city suitable for high density development and the land in docklands shouldn't be wasted on low rise or medium density crap :-)

tayser

October 3rd, 2007, 02:16 AM

I can attest to the above.

The problem I've just faced is that many of the good properties (like in Yarra's Edge) - tenancies are up and people are locking in capital gains thus the properties are withdrawn from the rental market for a longer period of time (they might be on sold to other investors etc).

I've had to stick in South Melbourne & my rent's gone up by about 60%.

I could have gone to a place for around the price I was paying (146 a week) - but it would have been a shitbox.

Londoner

October 3rd, 2007, 11:55 AM

It's good to know that some people have capital gains to lock in. I sold my City Point unit last month - bought off plan in 2000 for $423K + legals, sold for $430K, $415K net of expenses. Not what they tell at Central Equity 'investment seminars'! In the last year the net yield was about 3%. It was a useful learning experience though, and when I found my new unit in Vic Point I at least had a track record with the bank and a tame solicitor.

tayser

January 15th, 2008, 12:47 PM

What's going on with Watergate? there's a tonne of units for sale...

eins (http://www.domain.com.au/Public/PropertyDetails.aspx?adid=2006730996)
zwei (http://www.domain.com.au/Public/PropertyDetails.aspx?adid=2006879815)
drei (http://www.domain.com.au/Public/PropertyDetails.aspx?adid=2006829930)
vier (http://www.domain.com.au/Public/PropertyDetails.aspx?adid=2006696870)
fünf (http://www.domain.com.au/Public/PropertyDetails.aspx?adid=2006881232)
sechs (http://www.domain.com.au/Public/PropertyDetails.aspx?adid=2006903148)
sieben (http://www.domain.com.au/Public/PropertyDetails.aspx?adid=2006805631)
acht (http://www.domain.com.au/Public/PropertyDetails.aspx?adid=2006848154)
neun (http://www.domain.com.au/Public/PropertyDetails.aspx?adid=2006909622)
zehn (http://www.domain.com.au/Public/PropertyDetails.aspx?adid=2006831717)
elf, zwölf, dreizehn (http://www.domain.com.au/Public/PropertyDetails.aspx?adid=2006730995)
vierzehn (http://www.domain.com.au/Public/PropertyDetails.aspx?adid=2006848104)
fünfzehn (http://www.domain.com.au/Public/PropertyDetails.aspx?adid=2006639901)
sechszehn (http://www.domain.com.au/Public/PropertyDetails.aspx?adid=2006864113)
siebzehn (http://www.domain.com.au/Public/PropertyDetails.aspx?adid=2006777634)
achtzehn (http://www.domain.com.au/Public/PropertyDetails.aspx?adid=2006245947)
neunzehn (http://www.domain.com.au/Public/PropertyDetails.aspx?adid=2006880276)
zwanzig (http://www.domain.com.au/Public/PropertyDetails.aspx?adid=2006913212)

......at least 20 properties for sale. That was only up to page 10 or a 20 page search, click here (http://www.domain.com.au/Public/SearchResults.aspx?mode=buy&state=VIC&areas=Bayside&sub=Docklands&ptdes=All+Property+Types&sort=price-asc&searchterm=Docklands&page=10) for the rest of them (there are some double ups).

Any people in the know what's going on or is this just 'normal'?

Qantas743

January 15th, 2008, 12:58 PM

Drunkill

January 15th, 2008, 01:18 PM

Perhaps Lozza is making a ton of noise and driving everyone else away, playing 'cranes' in his spare time.
Or people don't want to live next to construction sites for awhile, although that'd be quite picky, seeming most of the docklands/city apartments will have construction quite close to them.
Qantas, just stop posting, it'd benefit us all.

Anberlin

January 16th, 2008, 01:27 AM

The developers in docklands need to get their fingers out of there arses and start releasing more towers. There is a limited supply of land in the inner city suitable for high density development and the land in docklands shouldn't be wasted on low rise or medium density crap :-)

I couldn't have said it any better myself :cheers:

melbournee12

February 21st, 2008, 10:39 AM

didnt know where to post this...i guess this is sorta apartments lol

http://business.theage.com.au/tourists-business-visitors-underpin-room-boom/20080217-1sns.html

Tourists, business visitors underpin room boom
Philip Hopkins
February 18, 2008

THE continuing influx of business visitors and tourists into Victoria is creating the best outlook in nearly 20 years for Melbourne's hotel sector.

CB Richard Ellis, in its 2008 market outlook, said Melbourne's accommodation sector was set for some of its best years for close to two decades.

CBRE's executive director of research for the Pacific region, Kevin Stanley, said the demand for hotel rooms continued to grow strongly, especially in Melbourne.

This was despite the fact that for the first time in 20 years, more Australians were going overseas for holidays than tourists were coming here.

"Over the last two years, the rate of growth for hotel rooms has doubled the rate of new rooms coming into the market," he said.

Mr Stanley said new airlines coming to Melbourne were bringing more domestic and international visitors. Budget carrier Tiger Airways now had Tullamarine as its national base and Qantas would bring the massive Airbus A380 to Melbourne by the end of this year.

Also, the State Government was stimulating activity by building the big new convention centre at South Wharf on the Yarra River.

"It already has bookings for over $300 million worth of conventions, yet the opening is not until mid-2009," he said. "It shows the demand is there; you just need to be prepared to support it."

Mr Stanley said as a result, all key hotel performance indicators were looking good. "Occupancy rates are now often over 80% and room rates are growing at 6 to 9% per annum," he said. "It doesn't get much better than this."

Mr Stanley said Melbourne was in fact leading the country in new hotel building. Two major projects — the third hotel at Crown Casino on Southbank and the Hilton at the convention centre — were under way.

"We think the quality and locations of these hotels should see them easily absorbed into the market," he said. "There are other potential hotel sites in Docklands, but they're yet to commence construction."

For investors, CBRE director Scott Callow said purchaser demand was consistently strong, but opportunities were few.

"Yield remains the key factor, with buyers seeking 7 to 8% returns. Investment capital is readily available through institutional and overseas buyers," he said.

Mr Callow said the key element of a successful hotel would always be location. "Proximity to transport hubs, office precincts and shopping centres remain the key drivers to new development," he said. "Interest in this sector has never been stronger."

Mr Callow said three hotels opened in the central business district last year — Oaks on Market, Oaks on Lonsdale and Leo Pacific in Little Bourke Street. the only CBD sales were Shoan Heights Serviced Apartments and the Explorers Inn.

JAKJ

February 23rd, 2008, 11:13 PM

Hi Guys,

We are tentatively looking at an apartment in inner-city Melbourne, I thought that you guys might have a good idea of what areas are good to look at (interesting projects coming online, existing areas with a good supply etc etc).
Any help would be very much appreciated (and if anyone has any interest in the Adelaide property market I would be willing to recipricate ;))

Cheers,

James

tayser

April 27th, 2008, 09:55 AM

removed by request

3/379

April 27th, 2008, 01:42 PM

seems like someone paid too much for something and is whinging about it...

Londoner

April 27th, 2008, 02:26 PM

A lot of people - myself included - have lost money on Central Equity apartments. Sold my first one at City Point bought off plan in 2000 last September for a little less than I paid, and I'd almost certainly lose money if I sold my other one.

As to whinging, to a certain extent if you lose money on an investment you have to take that on the chin. But the fact is that CE's marketing is based on misleading people by selectively presenting statistics - for example that Melbourne property prices have risen by x% per year, or the rental guarantee at an above market rate. If the truth was spelt out, that after commission and service charges you'll probably end up with 3-3.5% and your resale price is very likely to be less than you paid, how many would buy? Fortunately the internet gives people, especially overseas buyers, the chance to do some research if they choose to do so.

Beyond this, the story suggests that the buybacks were done with a view to creating a false market - so that they can say that someone paid x and sold for y. If they were still a quoted company, they would be having to ask questions.

Article here in yesterday's Daily Telegraph spells it out:

"... Attend one of Central Equity's seminars, and you have the chance to "win a shopping-spree holiday to Melbourne for two". More importantly, you are enticed to part with a 10 per cent deposit on a £139,000 Melbourne pad with nothing else to pay until completion. It is tempting and it is designed to be.

"Huge stamp duty savings up to £17,000" is another siren-call to buy, as the 5 per cent tax would apply to the value of the land, not the purchase price of the completed property. The deposit is held in a trust account by a solicitor and is guaranteed by the Australian government.

Divide any number by 2.1 - the current pound-to-Australian-dollar exchange rate - and most properties there look good value. The trouble is that Melbourne has suffered from a glut of apartments in recent years. Many investors bought off-plan because of stamp-duty reductions, but some buyers, seeing the upfront savings, forgot to compare against other properties in the area and do their homework on likely capital growth in a crowded market. ... "

http://www.telegraph.co.uk/global/main.jhtml?xml=/global/2008/04/25/noindex/paustralia126.xml

chrisaus

April 27th, 2008, 03:28 PM

They are pushing alot of Melbourne projects in perth atm aprartments in places like Hawthorn and South Yarra for under $200,000 which gets me thinking what is the catch?

Aussie Steve

April 28th, 2008, 03:37 AM

They are all bed sits, i.e. the bed is in a cupboard in the lounge room. So you really only get 2 rooms kitchen/lounge/dining/bedroom/entrance and the bathroom.

tayser

September 20th, 2008, 12:34 AM

Student housing sale fears Open market push in Carlton
Jason Dowling, City Editor
20 September 2008
The Age

THE shortage of student accommodation in Melbourne is expected to worsen if the owners of a big student apartment development in Carlton decide to sell their units on the open market.

A student accommodation lease covering most of the 690 College Square apartments in Lygon Street will expire in December and many of the owners have expressed interest in capitalising on the rise in real estate prices since they bought off the plan seven years ago. Only students can live at College Square apartments covered under the current lease.

Michael Petit bought his apartment in 2001 for $170,000 and is keen to make a capital gain on the investment.

"There are lots of people who don't want to live in Keilor and commute to Melbourne - we're talking about a prime location in Carlton where recent sales of one bedrooms have gone from $250,000 to $280,000," he said.

Mr Petit said 150 owners had contacted him hoping to sell the apartments on the open market and not just for student accommodation.

"My guess is of the 150, all want to be able to sell . . . Probably in the next year or so, 50 or 100 may go on to the market," he said.

Mr Petit is excited at the prospect of the student lease arrangement expiring. He said he had been told by a real estate agent that because it was only a student accommodation lease he might get just $140,000 for his apartment.

"After 10 years in Carlton I was going to take a $30,000 loss - it is amazing," he said.

He said the apartments would be worth more than $200,000 on the open market.

Glyn Davies, general manager development with YMCA Victoria, which manages the apartments, said the dwellings were suited for student accommodation and he hoped they would remain for students after a new five-year student lease was offered to investors in December.

He said there were only 160 car parks for the 690 apartments and he did not expect a big shift away from students living at College Square.

"I personally don't think it is going to significantly change. We may end up like some other of the (student accommodation) buildings in town where there is up to 10% owner-occupiers," he said. There are only about 10 owner-occupiers in the complex currently.

He said that if a significant number of owners rejected the new lease and there was a move away from student rentals it would only increase the strong demand in Melbourne's inner suburbs for student accommodation.

Planning and lease regulations on more recent student accommodation developments have cemented their use permanently for students, but College Square was built before the changes.

Melbourne City Council stipulates that "no planning permission is required to use a building for a 'dwelling' in this zone, so the shift from student accommodation to private residences would not require permission from council, as no rezoning would be necessary".

melbournee12

June 20th, 2009, 01:37 AM

The Age.

Penthouse prices tumbling
Natalie Craig and Marika Dobbin
June 20, 2009
MULTIMILLION-DOLLAR penthouses with panoramic city views in South Melbourne are now on offer at half the price they were a week ago.

But there's a catch. You might not have room for a grand piano.

Developer Salvo has decided mid-construction to cut its full-floor penthouses at 109 Clarendon Street in two as demand at the loftier end of the property market wanes. Once selling for $2.7 million, the smaller spaces can now be picked up for about $1.3 million.

"Less than $1 million is selling well but the leftovers are the dearer stuff," developer Mario Salvo said yesterday. "With the state of the top end, we're cutting the penthouses in half … there's even flexibility to convert into quarter apartments."

In the face of the global financial crisis, many developers are scrambling to meet a change in buyer demand, redesigning their blueprints to make apartments smaller and more affordable.

Meanwhile, luxury apartments projects conceived at the height of the property boom, such as Lucient in St Kilda Road, have been slow to attract buyers.

An Age investigation into Melbourne's residential market has found a nuanced but generally optimistic picture, in which demand has rebounded for apartments costing less than $1 million and houses at less than $2 million.

However, the market for multimillion-dollar property has dropped off significantly since the heady days of 2007. The trend is so apparent, developers are reconfiguring plans mid-project, at sometimes massive costs, to suit buyers' more modest budgets.

Stockland is offering to return deposits on planned luxury apartments at Tooronga, after deciding to launch instead smaller apartments with prices aimed at first home buyers and investors.

MAB's Harbour 1, also altered in the planning stage, now has one-bedroom and studio apartments starting at $390,000. MAB said it was the first time in years you could "get into the Docklands" for less than half a million dollars.

On the house front, demand for luxury property continues to dwindle, as a surge of first home buyers buoys prices at the lower end. A recovery in the luxury house market appears some way off, with just half the number of house sales over $2 million so far this year than this time last year, according to the Real Estate Institute of Victoria. Just 32 multimillion-dollar houses have been sold, compared with 51 during the same period last year and 64 the year before.

The situation is even more apparent in $5 million-plus sales, where it is not uncommon to see houses that fetched record prices and set the real estate market on fire during the boom now languishing on the market or being sold at a loss.

Just eight Melbourne houses have been reported sold for more than $5 million in the first half of this year, compared with 13 in the same period of last year and 28 in the 2007 boom.

But there are signs that houses under $2 million in blue-ribbon and inner suburbs are back in favour after a hiatus at the end of last year.

While there are still few million-dollar house sales in second-tier suburbs such as Bentleigh, Black Rock and Glen Waverley compared with 2007, recent results in suburbs such as Carlton, Brighton, Toorak and Hawthorn have agents feeling optimistic that the higher end of the middle market has turned the corner